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Wow, it’s hard to believe nearly a year has gone by since I last posted on this blog. When I started “They Create Worlds” a few years ago, the idea was that I would use this space to highlight my sources and organize my thoughts for the books I currently plan to write on video game history. The text seen here is not the text of the book itself, which will be narrative rather than so heavily focused on reporting what the individual sources say, but it has served as an incubator for some of my thoughts and theories.

Once I started writing the first book in earnest, I realized there was no way I could realistically undertake both massive writing projects at the same time. Therefore, I have spent the last year focusing on actually writing the book, which I hope to have finished sometime next year (hopes of completing it by the end of this year proved overly optimistic, but much progress has been made). I do plan to return to this blog at some point, however, because I believe the source evaluation I am doing here is valuable for other researchers and historians and will serve to explain some of the narrative choices I make in the books themselves, which are less concerned with highlighting all the contradictions in the underlying sources.

In the meantime, I will be updating the posts already on here from time to time as I make new discoveries in my research, and I continue to podcast twice a month on various topics in video game history (like so much on this site, the podcast listings I maintain here are out of date and more recent episodes can be found on the podcast website). I thank you all for your continued interest in my work.

In June 1967, Ralph Baer received permission from the leadership of Sanders Associates to complete his TV game prototype and bring it to market. While this represented a significant milestone for Baer, however, there was still a great deal of work to be done. At this point in his life, Baer was not a particularly accomplished game designer, and he felt his prototype did not offer the level of entertainment value necessary to justify its price. Development on the project almost stalled completely until the addition of a new team member that lobbied for generating a third dot on the television screen, which finally led to the addictive game the system needed.

Even after the team overcame all the design hurdles, however, there was still the matter of introducing the system to the general public. As a defense contractor, Sanders did not have any of the retail experience or clout necessary to produce a consumer product and would therefore need a partner to place Baer’s system on store shelves. After multiple deals fell through at the last minute, Baer finally enticed Magnavox to build his TV game, and the long journey that began on a bus terminal step in August 1966 ended in September 1972 with the debut of the first home video game system, the Magnavox Odyssey.

As in the previous entry, there is little controversy regarding the design and development of Ralph Baer’s “Brown Box” prototype and its final incarnation, the Odyssey, due to Ralph Baer keeping meticulous records of the project and preserving them for posterity. There is, however, considerable confusion over the success — or lack thereof — of Odyssey in the marketplace. In this post, I will attempt to untangle the contradictory evidence of the Odyssey’s market performance and place it in the context of early video game history.

Three Spots

Bill Harrison (l) and Bill Rusch, the men who built Baer’s video game prototypes

In the aftermath of the successful demonstration of TV Game #2 to Royden Sanders and other company executives in late June 1967, Ralph Baer turned his attention toward refining his system into a viable commercial product. According to his autobiographical work, Videogames: In the Beginning, Baer hoped to create a relatively cheap game, setting a target price of $25.00 for the complete package. This meant refocusing the system around what Baer considered the best ideas he and Harrison had developed in order to reduce the part count. Harrison removed the pumping game mechanic, which despite being the first game implemented had never been particularly fun, as well as the specialized circuits that allowed for color graphics and the placement of additional dots on the screen through a random number generator. By August 1967, Harrison had completed his scaled-down version of the system, dubbed TV Game #3, which now only played chase and shooting games. Unfortunately, despite cutting as many corners as they possibly could, Baer and Harrison were unable to come near their target price: the system they built would have to sell for a minimum of $50.00 at retail. Baer felt his simple chase and light gun games did not provide nearly enough entertainment value to justify that price, so he put the color circuitry back into the system and tried to develop additional game concepts. When he proved unable to find a way to make the system more interesting, Campman, who sensed Baer had hit a wall in development, decided to loan Baer his former brainstorming partner, the creative engineer Bill Rusch. On August 18, 1967, Rusch formally became the third member of the Sanders TV game team.

According to both Ralph Baer and Bill Harrison, Bill Rusch was not the easiest person to work with. In an interview by Benj Edwards, Harrison called Rusch “very different” and “a colorful character,” while Baer lamented to Tristan Donovan that he would show up late, putz around for an hour before turning to the task at hand, take a two hour lunch, and generally spend as little time as possible actually working. As Baer told Kent in The Ultimate History of Video Games, he was so desperate to motivate the frustrating engineer that he let him work on a pet project involving changing the octave of notes played on a guitar in addition to the TV game project. Despite these difficulties, however, there was no doubting Rusch’s intelligence or creativity. Indeed, soon after joining Rusch proved his value by proposing the idea that saved the entire project: adding a third, machine-controlled dot to serve as a ball for use in a game of ping pong. (Note: Kent states that Rusch implemented the chase game on the system as well, although this was already completed by the time he joined the team. Chase games were one of several concepts in Rusch’s May game memo, however, which may be the source of Kent’s confusion.)

According to Videogames: In the Beginning, Harrison and Rusch spent October 1967 making the new three spot system a reality, which became TV Game #4. While Harrison built the new system, Rusch spent the majority of his time designing advanced circuits that would allow for the generation of round spots instead of squares and allow the speed and direction of the ball spot to vary based on the velocity of the impact with a player-controlled spot. Ultimately, however, neither of these features were incorporated, the former because it remained buggy and the latter because Baer felt they did not have time to complete it. This led to considerable friction between Baer and Rusch, who did not appreciate Baer telling him what could and could not be incorporated into the system. Nevertheless, by November 1967 the team had a video game unit that could play ping pong, chase, and shooting games with three controllers: a light gun for target shooting, joysticks for the chase game, and a three dial control for ping pong that controlled the horizontal and vertical movement of the player’s paddle and allowed the player to manipulate the ball to put a little “English” on it. After another demo for Campman, the R&D director concurred with Baer that the system finally contained enough interesting gameplay variants to be worth selling, so Baer turned his attention to finding a retail partner.

Baer turned first to the fledgling cable industry. At the time, there were no dedicated cable channels, so cable TV was basically just an expensive way to receive the exact same channels that a person could already get for free over the air. While cable eliminated the need to adjust antenna to improve the quality of a broadcast signal, unless a person lived in the mountains or in a similar environment where reception was exceptionally poor, this convenience did not justify the cost. As a result, the cable industry was struggling, and Baer felt that a novel product like a TV game could be just the thing for the industry to break out of its slump. He therefore had Harrison modify the game so that it could accept background graphics transmitted by a cable signal and contacted the largest cable provider, TelePrompter, which supplied roughly 60,000 subscribers at that time. The idea was that the cable company could point a camera at a highly detailed view of a tennis court or some other venue which would be broadcast to the TV game to provide a background for the action. The spots generated by the hardware would then be superimposed on top. TelePrompter expressed interest, and negotiations proceeded on and off between January and April 1968. While the cable company thought the game a good idea, however, an economic recession ultimately left it in an untenable financial situation, and it could not afford to develop the product. Baer would need to find another partner.

Brown Box

The “Brown Box” prototype

In December 1967 and January 1968, Harrison continued to work on improving the TV game, incorporating some of the velocity circuitry designed by Rusch and re-implementing the light pen quiz game with a new light gun peripheral that would allow answers to be chosen from a distance. In this game, four answers would appear on the screen with dots next to them. The dots would all blink rapidly, with the dot next to the correct answer blinking in a different pattern than the others. This was all imperceptible to the naked eye, but the light pen would respond differently to the correct and incorrect dots in order to determine if the player answered correctly. Two new ball-and-paddle variants were created during this time period as well, handball and volleyball. In handball, the “net” was moved to one side of the screen and served as the wall of a handball court, while in volleyball, the centerline was modified to serve as a net. Otherwise, the gameplay remained the same as in the ping-pong game. Work on TV Game #5 ceased at the end of January when funding ran out. The same recession affecting TelePromper also hit Sanders hard, and the company scaled down from 11,000 employees to just 4,000 during this period. This marked the end of Bill Rusch’s short, but productive time on the project.

In September 1968, Baer secured additional funding and brought back Bill Harrison to create another prototype, TV Game #6. The switches used to select different game modes in previous versions were replaced with a rotary dial, while the game also sported an improved light gun. Still feeling they could do a little better, Baer and Harrison developed one final prototype in January 1969, TV Game #7, which they also called the “Brown Box” because Harrison wrapped the casing in self-adhesive woodgrain to make it more attractive. This version also included an expanded set of games. In addition to Ping-Pong, Handball, Volleyball, Target Shooting, and the Checker chase game, there were now Hockey, Soccer, and Football variants of the ball and paddle game, which featured the same basic game play with different overlays, and a golf putting game with a new peripheral: a golf ball mounted on a joystick. The player would place the joystick on the floor and tap the ball with a putter, after which the spot representing the ball would move based on the contact with the joystick. If the ball hit the dot representing the hole, they both disappeared. A final attempt was made to add Rusch’s velocity circuit to this version as an add on, which was dubbed TV Game #8, but it was ultimately left out due to cost.

By the end of 1968, Baer and Harrison had essentially finished the Brown Box, but they were no closer to selling it. Finally, the Sanders patent attorney, Lou Etlinger, provided the solution: approach the television manufacturers. These firms were already using the exact same components contained within the Brown Box in their TV sets, so ramping up manufacturing would be relatively simple. Additionally, the TV companies would most likely be interested in anything that could spur television sales. One by one, Etlinger invited some of the most prominent TV manufacturers — RCA, Zenith, Sylvania, General Electric, Motorola, Warwick, and Magnavox — to view the Brown Box in action. While many of these companies showed some interest, however, Baer and Etlinger were never able to close a deal. Warwick, the manufacturer of televisions sold by Sears, was impressed and told Sanders to contact the buyer at the department store, but the executive refused to sell the product in his stores, afraid parents would drop their kids off in the electronics department to play the games and transform Sears into a glorified babysitter. The General Electric engineers were likewise impressed and helped set up a meeting at the company’s small-color-set assembly facility in Virginia, but nothing ever came of it.

The first company to view the system, RCA, ultimately proved the most enthusiastic. Coming to Nashua in January 1969, RCA liked the system so much that it started negotiating a licensing agreement with Sanders in the Spring. An agreement was hammered out after several months of negotiations, but Sanders ultimately backed out of the deal. Baer has never specified the exact reasons Sanders did not like the final agreement, only calling the terms “onerous,” but RCA probably either wanted to completely own the technology and the patents behind it or offered a paltry royalty deal. Sanders appeared out of options at this point, but luckily one of the RCA negotiators, Bill Enders, remained highly enthusiastic about the product, so when he left RCA to join Magnavox, he urged his new employer to take another look at the system.

Magnavox

Edwin Pridham (l) and Peter Jensen, two of the founders of the company that formed the core of Magnavox

The Magnavox Corporation traces its history to a partnership formally established on March 1, 1911, called the Commercial Wireless and Development Company that brought together three individuals, Danish electrical engineer Peter Jensen, Stanford-trained electrical engineer Edwin Pridham, and San Francisco financier Richard O’Connor. According to The Early History of Magnavox by Billy Malone, Jensen, born in 1886, was a brilliant student forced to forego university and take a job at a sawmill upon the death of his father. The superintendent of the mill encouraged him to find a job more suited to his academic abilities, however, and in 1903 he was able to secure a position in the laboratory of Valdemar Poulsen, the Danish inventor of the Telegraphone, the first magnetic wire recording apparatus, the predecessor of magnetic tape recording. In this capacity, Jensen helped Poulson develop his continuous wave arc transmitter, one of the key technologies that allowed for practical radio broadcasting. In 1909, Jensen came to Palo Alto, California, which even before forming the heart of Silicon Valley was an important hub for wireless research, to grow the Poulsen Wireless and Telegraph Company, formed in October of that year in partnership with Stanford engineer Cyril Elwell and investor John Coburn.

While at the company, Jensen met Pridham, a fellow employee originally hailing from Maywood, Illinois, who helped him learn English and assimilate into American culture. He was also introduced by Coburn to O’Conner, an investor in the new venture frustrated that he had no say in company affairs. Coburn proposed that O’Connor travel to Denmark to secure patent rights from Poulsen to start his own company and suggested Jensen resign his position and join the negotiating team. Jensen agreed on the condition that Pridham be allowed to join them as well. Although the Danish trip was unsuccessful, O’Connor pressed forward with his plan to establish the Commercial Wireless and Development Company with Jensen and Pridham in 1911.

Once their new company was established, Jensen and Pridham turned their attention to developing a more sensitive telephone that could pick up signals transmitted from a greater distance. According to an article hosted on the website of the Audio Engineering Society entitled “Peter L. Jensen and the Magnavox Loudspeaker,”, the result of this research was an improved version of the Poulsen arc radio transmitter featuring thicker wires connected to a diaphragm and a coil of copper wire placed between magnets. Driving a current though the coil produces a magnetic field that causes the coil to move back and forth rapidly. This causes the coil to push against the diaphragm, thus converting the electrical signal into soundwaves. Per The Early History of Magnavox, this resulted in a telephone with much clearer sound, but AT&T chose not to adopt the “dynamic telephone” because they were already partnering with Lee DeForest to use his audion tube in their equipment, and the Jensen system was too large and bulky to be practical.

In 1915, a blacksmith named Ray Galbreath visited Jensen’s lab. An avid baseball fan, he lamented that he often had difficulty hearing announcements made at the ballpark and thought the dynamic telephone could be used to amplify the announcer. This suggestion caused Jensen to shift his focus from improving the clarity of sound over a long distance to increasing the volume of sound over a shorter distance. After several months of work, Jensen publicly demonstrated the first loudspeaker public address system in San Francisco on December 10, 1915. He decided to name the system after the Latin term for “great voice,” Magnavox.

In 1916, Jensen, hoping to find a mass market application for the new loudspeaker, developed an all-electric phonograph incorporating loudspeaker amplification. A demonstration was arranged for the largest phonograph company, Victor Corporation, but they were not interested. Victor’s main competitor, Columbia, also turned them down. As Jensen and company continued to refine their player, however, they purchased large quantities of records from the Sonora Phonograph Distributorship Company, which attracted the attention of its president, Frank Steers. Steers saw the potential of the electric phonograph and arranged a merger between Sonora and Commercial Wireless to manufacture the device. On July 6, 1917, the combined company incorporated under the name Magnavox. At the time, PA systems remained an integral part of the company’s business, but according to the AES article AT&T came to dominate this market in the 1920s, so Magnavox shifted its primary focus to phonographs and radio. According to Malone, the company moved its headquarters to Emeryville, California, in 1927, and then consolidated its various facilities in Fort Wayne, Indiana, in 1930. According to an oral history with former Mangavox employee Arthur Stern, the Great Depression nearly killed the company, which barely avoided bankruptcy in the late 1930s, but the onset of World War II and lucrative military contracts for electronic equipment saved it. After the war, Magnavox entered the television business, and it remained a major player in the field in the early 1970s, when Ralph Baer and Lou Etlinger approached the firm to license the first home video game system.

Building Odyssey

The motherboard of the Odyssey

According to Baer’s book, in July 1969, Bill Enders, recently relocated from RCA to Magnavox, returned to Nashua for a personal demonstration of the Brown Box. Still impressed with the technology, he began heavily lobbying his superiors to license the product. This campaign culminated in a demonstration of the technology at Magnavox headquarters in Fort Wayne on July 17, 1969, for Gerry Martin, the VP of the Magnavox Console Products Planning Division. Martin was immediately taken with the technology, though it would take him months of lobbying with Magnavox corporate before he was finally authorized to negotiate a deal in March 1970. Nearly a year of negotiations followed, culminating in a preliminary licensing agreement between Sanders and Magnavox in January 1971.

With a license agreement in place, further development of the Brown Box — known within Magnavox by the product designation 1TL200 — shifted from Baer’s lab at Sanders to a team of Magnavox engineers in Fort Wayne led by George Kent. While Baer and Harrison would consult with these engineers from time to time, their active role in the development of the video game was now over. At Magnavox, management placed a great emphasis on reducing the cost of the system as much as possible, ultimately leading to the removal of the chroma circuitry for generating color backgrounds, the golf putting game, and any chance of including the pumping and quiz game functionality that Baer and Harrison had already stripped out of earlier prototypes of the system. They also chose to move away from switches or dials to select games by including a group of plug-in circuit cards instead that would unlock individual games. This last innovation has led some to label the system the first cartridge system, though this comparison is not apt. There was no memory or game code on these cards, which merely complete different circuit paths within the hardware itself to define the rule set for the current game. All of the game information was contained in the dedicated hardware, and inserting a new circuit card was really no different an act from flicking a toggle switch.

Initially, the video game project was placed under the control of Bob Wiles, the product manager for color TVs, but it was soon placed in its own product category. The man ultimately responsible for bringing the Odyssey to market was a product manager named Bob Fritsche, a 1966 graduate of Miami University of Ohio with a degree in marketing who joined the Air Force right out of school, mustered out in October 1970 at the rank of captain, and subsequently joined Magnavox. According to court testimony delivered by Fritsche in December 1976 during the case of Magnavox v. Chicago Dynamic Industries and Seeburg Corporation, he started in the purchasing department before becoming the first product planner on the video game system in September 1971. At the time, Magnavox had just begun performing consumer playtest and marketing surveys using prototype hardware of what was now being called “Skill-O-Vision.” The first, conducted in Los Angeles, proved highly successful, so a second survey was scheduled for Grand Rapids, Michigan, to gauge the response in a more technologically conservative part of the country. According to Fritsche, this test proved highly successful as well. Indeed, original market projections had called for an extremely limited production runs of 50,000 units for the first holiday season, but based on the marketing surveys, Fritsche argued that they should build 100,000 units instead. In order to insure Magnavox dealers across the country had sufficient stock to meet market demand, the company decided to release it in only eighteen major markets, one metropolitan area in each of its 18 sales territories nationwide.

According to Fritsche, Magnavox unveiled the final version of the system, now dubbed the Magnavox Odyssey — a name whose origin has been lost to time — to its authorized dealers for the first time in May 1972 in Las Vegas. Soon after, the product was formally introduced to the press at an event hosted by Tavern on the Green in New York City (according to Baer, this event occurred on May 22, though he mistakenly calls the restaurant “Bowling Greene”). Over the next few months, Magnavox took the product on the road, hosting shows in roughly 16 cities to allow their dealers and other interested industry parties to familiarize themselves with the product. When exactly the system first went on sale is not known. According to Fritsche, Magnavox started shipping the system in mid September. Frank Cifaldi claims in an article on Gamasutra that the system was available as early as August 28 based on an ad in the Edwardsville Intelligencier, but this add merely invites people to “See Odyssey” and contains no language implying that the system is actually available for purchase. Most likely this was a preview event in anticipation of the product arriving in the next month.

The System

The complete Odyssey package, including overlays and accessories

The Magnavox Odyssey hit store shelves at a suggested retail price of $99.99, roughly double what Baer had originally planned. The system shipped with 12 games unlocked by six circuit cards, most of which were variations on the ball and paddle and chase games that Baer, Harrison, and Rusch had developed at Sanders. The system remained capable of generating only two player-controlled dots plus one machine controlled dot and a single line of varying height, so all of the game mechanics were based around moving dots around the screen. Each game required a plastic overlay, which would cling to the TV through static electricity to provide background graphics and other game features. Additionally, the system shipped with cards, play money, and dice to provide additional play mechanics. According to an interview with artist Ron Bradford, all of the final game designs — as well as the overlays and packaging materials for the system — were done on a contract basis by his firm, Bradford/Cout Design, which had previously done creative work for Magnavox’s ad agency. Bradford developed the games in conjunction with Steve Lehner at the agency.

While Baer had developed several different control schemes for different types of games, the final system only shipped with one: the three dial control that allowed the player to move his dot horizontally or vertically as well as exert a small amount of control over the machine-controlled dot. The controller also contains a reset button, which is not used to reboot the console, but rather to reset certain game elements during play. Two additional controls are present on the main unit: a dial to adjust the position of the center line on the screen and a dial to set the speed of the machine-controlled dot. While many sources, most notably Kent, claim the internals were analog, the system was constructed using digital logic circuits. As Baer explains in his book, however, these were not the cutting edge transistor-to-transistor logic (TTL) circuits becoming increasingly common in the early 1970s. Instead, the system used more primitive diode-to-transistor logic (DTL) to keep down the cost of the hardware. The twelve games that shipped with the system are as follows:

Table Tennis (Game Card #1): Each player controls a paddle and they knock a ball back and forth across the screen. The only game that does not require an overlay or any other additional elements. Score is not tracked by the game and must be recorded manually.

Ski (Game Card #2): A timed racing game. The overlay provides several different paths and includes pictures of obstacles like trees and mountains. The player navigates his dot along the path and takes a penalty defined by the instructions any time he goes off the path and hits an obstacle. Players must keep track of their own time using a clock or stopwatch.

Simon Says (Game Card #2): A three-player variation on the classic children’s game. The overlay depicts a boy and a girl, each of which is claimed by one player. The third player draws from a deck of 28 “simon says cards” that each depict a part of the body. Each time a card is drawn, the players must move their spots to the proper body part on their person. Whoever gets there first wins the card. If there is a tie, the card is returned to the bottom of the deck. Players only move if the card drawer uses the phrase “simon says.” If they move when the phrase is not used, they have to return a card to the deck. The player with the most cards at the end wins.

Tennis (Game Card #3): Plays essentially the same as the Table Tennis game except there is an overlay on the screen depicting a tennis court and service must follow the rules of tennis (i.e. in order for a serve to be “good” it must land in the other player’s “service box”).

Analogic (Game Card #3): An arithmetic game presented with the conceit that it takes place in a “numeric maze of a computer-charted galaxy.” The overlay consists of a grid in which each square has a number. Players start on opposite ends of the screen on “Planet Odd” and “Planet Even.” The former player can only move to a square containing an odd number, while the latter player can only move to a square containing an even number. After the first turn, a player may move to any square containing a number that corresponds to the sum of the other player’s last move and any other number so long as the sum results in an odd number for the Planet Odd player or an even number for the Planet Even player. The first player to reach the opposing player’s planet wins.

Hockey (Game Card #3): Again like Table Tennis except the overlay is a hockey rink. A player scores if the dot touches the opponent’s goal on the overlay.

Football (Game Card#3 and Game Card #4): Easily the most complicated game. Uses a combination of on-screen maneuvering, dice, and “play cards” to simulate a game of football. The kickoff as well as passing and punting plays use the ball spot and are done with Card #3. Running plays use only the two player spots and are executed with Card #4. Full rules can be viewed at a page hosted by the University of Waterloo that is dedicated to the Odyssey.

Cat and Mouse (Game Card #4): A chase game played on a grid. The mouse must return to the square designated as his “house” without being caught by the cat. The players get a varying number of points depending on where the mouse is caught.

Haunted House (Game Card #4): Another chase game with a haunted house overlay. One player is a “detective,” while the other is a “ghost.” The overlay contains “clue” spaces that the detective must traverse in the order determined by a deck of clue cards, but if he passes over a window on his way to a clue, he forfeits the card. At the beginning of the game, the ghost also picks a clue space to place his ghost. When the detective approaches that space, the ghost player hits the reset button to reveal his spot. After that point, the detective must avoid making the ghost spot disappear or he forfeits half his clue cards.

Submarine (Game Card #5): A target shooting game played with an overlay showing various shipping lanes. One player navigates his spot along the lanes. The other player uses the reset button to launch the machine-controlled dot, which represents a torpedo. The players take turns in the roles, and whoever sinks more ships wins.

Rouelette (Game Card #6): A game of chance played with a roulette wheel overlay. Bets are placed using chips and a number board that come with the system. After bets are placed, a player randomly turns the control dials and then presses reset to launch the ball on the roulette wheel.

States (Game Card #6): An educational game played with an overlay of the United States and a deck of fifty cards — one per state — with trivia questions about that state. Players use the controller to select a state and answer questions to gain control of cards. The player with the most cards at the end wins.

Six more games were sold separately, most of which just provided new overlays and instructions for use with the circuit cards that shipped with the game. These were available for $5.49 each or in a pack of all six for $24.99. The games are as follows:

Fun Zoo (Game Card #2): A racing game for three players using an overlay of a zoo. The zookeeper draws an animal from a deck of cards, and the other two players see who can reach it first.

Baseball (Game Card #3): Like Football, this is a complicated game that uses a combination of cards, dice, and tokens. The players on each side have some basic statistics determined by rolling dice. Full rules can be viewed on the Internet Archive.

Invasion (Game Card #4, Game Card #5, and Game Card #6): Another complicated game in which strategic moves are made on a separate game board and tactical combat is resolved on the screen. Different kinds of assaults require different circuit cards. Full instructions at the Internet Archive.

Wipeout (Game Card #5): A racing game using both a track overlay and a game board. Player laps are completed by maneuvering a dot around the screen. The second player dot and the machine-controlled dot serve as a primitive timer, with the machine dot moving across the screen and then bouncing back when it hits the second player dot, which remains in a fixed position. Laps are tracked on the game board. Players take turns racing, and the first to pass the finish line on the board wins.

Volleyball (Game Card #7): A ball-and-paddle variant with a volleyball court overlay. The players must use the English control to arc the ball over the net.

Handball (Game Card #8): Another ball-and-paddle variant with a handball court overlay. Both players are on the same side of the screen and hit the ball to the white line, which acts as a wall.

Additionally, the light gun developed by Harrison was released as a separate accessory that came with four games using two additional game cards and sold for $24.99. The games are:

Prehitoric Safari (Game Card #9): The overlay features ten different targets. One player lines up the dot on a target, which the other player tries to hit with a single shot. Each player takes fifteen shots, and the one with the most hits wins. A variant gives different point values for different targets.

Dogfight! (Game Card #9): The overlay features a flight path. One player maneuvers the dot along the path, while the other attempts to shoot it.

Shootout! (Game Card #9): The player-controlled spot is an outlaw that must traverse a set path through a western town overlay, pausing at each window long enough to give the other player a chance to shoot him.

Shooting Gallery (Game Card #10): The overlay contains several rows of standard shooting gallery targets. The player-controlled spots are placed at either end of the first row of targets, and the machine-controlled spot then moves back and forth between them as the player tries to shoot it. After ten passes, the sequence is repeated with the next row of targets. Whoever has the most hits after taking shots at every row of targets wins.

One final game created for the system was held back and given out free to players that mailed in a survey card packaged with the system. This game, called Percepts, used Game Card #2 and is another racing game in which the overlay contains squares with patterns and symbols on the them. The players must race to the proper square when a card containing that pattern or symbol is drawn.

Market Performance

The Odyssey Tennis Game, complete with overlay

The Odyssey initially launched in 25 markets in September 1972, seven more than originally planned. According to Fritsche’s testimony, Magnavox expended considerable effort to increase production capacity and build additional systems based on the favorable feedback gathered during the marketing surveys. Rather than making these systems available to retailers generally, distribution was restricted to the Magnavox network of dealers that sold the company’s products exclusively. According to Fritsche, this decision was made by a senior marketing VP who felt that since the Odyssey would be the world’s first video game system, it would draw customers to Magnavox dealers and therefore present an opportunity to sell them a full range of Magnavox products. Indeed, while the suggested retail price of the system was $99.99, when purchased in conjunction with a Magnavox television set, the price fell to just $50.00.

According to Baer, the launch of Odyssey was supported by a national advertising campaign featuring glossy sales flyers, in-store displays, and national television and radio ads. A video available at the Pong Story website also shows that the Odyssey was demonstrated on the popular game show What’s My Line? in 1972. Baer claims that the television commercials featured Frank Sinatra, but no video has surfaced of a Sinatra-led advertisement. In fact, the only ad that has been discovered, which was on the air by early 1973 at the latest, only features two adults playing several of the games available for the system. The September 29, 1973 edition of Billboard, however, reported that Magnavox had just negotiated a deal to sponsor a Sinatra television special to promote its consumer products line. I believe that in this case, Baer is confusing this television special and the associated ad campaigns with Magnavox’s 1972 advertising campaign and that there were no Sinatra-led commercials for the system at launch.

According to Baer, Magnavox ultimately produced 140,100 Odyssey systems in the first year, far more than the originally projected 50,000. Don Emry, an assistant product planner that joined the Odyssey team in Janaury 1973 after working on the technical documentation for the system the previous year, stated in an interview with the Digital Press that he believes most of the numbers Baer reported are a little high, and he recalls the original production run being closer to 120,000. Either way, according to Fritsche’s testimony, Magnavox only sold 69,000 units in the first holiday season (he initially says 89,000, but corrects himself during cross-examination), and Emry remembers the warehouse was still full of systems in early 1973.

Why did the system sell so poorly in the first season? While impossible to say for certain, a number of factors have been identified. Baer believes price was a major factor, as $100, equivalent to $569 today, represented a significant investment in a new and unproven technology that offered relatively limited game play. He also points to the limited distribution to Magnavox dealers as a factor, and Fritsche relates in his court testimony that he would have liked broader distribution but was overruled by marketing. Baer also claims that Magnavox dealers were not properly trained in pushing the additional cartridges, which often remained under the counter unsold.

Baer further believes that Magnavox’s television ads confused customers into thinking the system only worked on a Magnavox television set, but the 1973 ad clearly states that the game will work with any television regardless of brand. Its possible that an earlier ad in 1972 resulted in confusion and led to a revised ad being aired early the next year, but since no other Odyssey ads from the period have surfaced, this cannot be verified. Even if Baer is wrong on this point, however, the system was only purchasable from Magnavox dealers as part of a marketing strategy to sell Magnavox TV sets, so even if the ads were not ambiguous, many consumers may well have been left with the impression that the system only worked on Mangavox TVs when they saw it at retail. In his interview with Digital Press, Emry states that he does not believe Magnavox had an official policy of implying exclusivity, but he concedes its possible that certain dealers could have marketed the system that way to benefit their own business. Don Emry also points out that sales were actually in line with the original Magnavox projections, so the relatively poor performance of Odyssey in 1972 may have more to do with an over-excited marketing department ordering the production of more systems than the market could actually bear.

According to Baer, Magnavox management soured on the Odyssey after that first holiday season and considered liquidating the remaining stock and exiting the business altogether. Ultimately, however, modest continuing demand by retailers for additional systems for the 1973 holiday season convinced the company to manufacture a small run of 27,000 additional systems to complement existing back stock. The result, according to Fritsche’s testimony, was a modest sales improvement to 89,000 systems. According to Baer, the system was also released internationally for the first time this year and was eventually available in twelve countries: Australia, Belgium, France, Germany, Greece, Israel, Italy, the Soviet Union, Spain, Switzerland, the United Kingdom, and Venezuela. The international version removed five games (Cat & Mouse, Football, Haunted House, Roulette, and States) and replaced them with three games sold separately in the United States (Soccer, Volleyball, and Wipeout). (NOTE: According to Pong Story, the console was also released in Mexico) The company also authorized the release of four new games in 1973, two of which were started by the Bradford/Cout team and completed by Don Emry and two that Emry designed completely on his own. The games were:

Brain Wave (Game Card #3): A complicated strategy game using cards and dice. Full rules at the Internet Archive.

W.I.N. (Game Card #4): Players must highlight letters, numbers, and symbols displayed on the overlay with their spot to fill out their “Win card” to win the game. The player actually renders his dot invisible by touching the other dot on the screen and then has to guess where to move the dot before hitting the reset button to make it appear again.

Basketball (Game Card #8): Another ball-and-paddle variant played using a basketball court overlay.

Interplanetary Voyage (Game Card #12): Unlike other variants, the spot in this game has momentum, so it will continue to move after the player stops turning his dial. The goal is to complete missions by guiding the spot to planets on the overlay based on instructions contained on mission cards. The player has only so many “rocket blasts” to reach the planet.

As reported in the September 22, 1973, of Billboard Magazine, Magnavox decided to stage a massive promotion of its 1974 consumer products line in late 1973 through an unprecedented $9 million advertising campaign highlighted by a sponsored television special featuring Frank Sinatra. According to Billboard, all of Magnavox’s products benefited from the campaign, and according to Fritsche, sales of Odyssey reached 129,000 for the year (Note: Baer reports 150,000 for the year, but his numbers always appear to be high based on the recollections of others. Interestingly, in 1975, Mechanix Illustrated stated Magnavox sold only 90,000 systems in 1974. Magnavox did release the system in several European countries, so its possible that the 90,000 figure represents domestic sales, and the other 40,000 were sold overseas). According to Baer, Magnavox discontinued the original Odyssey after 1975 and sold roughly 350,000 total systems. Mechanix Illustrated states that Magnavox planned to sell 100,000 systems in 1975, yet Fritsche, who left Magnavox in the middle of 1975, states that the company planned to sell 210,000 systems that year and was close to reaching that goal already when he left the company. If his figures are accurate, Magnavox may have sold as many as 500,000 Odyssey systems (NOTE: The context of the testimony implies that these were projected sales of the original Odyssey only. However, Magnavox did release the Odyssey 100 and Odyssey 200 in 1975 as well, so its possible this projection includes sales of these two systems, which would explain why it is abnormally high compared to other estimates. Fritsche left the company before Magnavox began selling its newer systems, so it’s also possible that Magnavox cut its targets after he left, perhaps due to retailers cutting orders of the old system when they realized the new system would be a bigger hit.). Either way, these represent fairly modest sales for a product on the market for four holiday seasons.

So can the system be considered a success? Baer certainly thinks so, calling it successful on the strength of its sales alone, though he doubts it did much to help Mangnavox’s bottom line when factoring in production and advertising costs and the processing of roughly 40,000 product returns. Both Bob Fritsche and Don Emry reported that the system was well received by the public, though Emry notes that the overproduction of the system hampered the ability of the Odyssey team to expand the product line. Historical works tend to take a more negative view. Kent considers it a failure, but he reports wildly inaccurate sales figures of only 100,000 units over the life of the console. Phoenix author Leonard Herman also declares it a failure, while Harold Goldberg cites Baer’s sales and costs estimates in All Your Base Our Belong to Us to conclude that the system did not perform well.

In the end, the Magnavox Odyssey cannot really be considered a success. Though it remained on the market for three years, sales remained modest, and Magnavox provided little support to the product team. No new games were created after 1973, and according to Emry plans for both a cheaper version of the console with fewer games and a four-player variant had to be shelved when Magnavox declined to expand the product line. Baer, too, noticed a lack of interest on the company’s part to improve the system: when he took it upon himself to create an add-on that would add sound to Odyssey games, it was turned down.

The console also failed to spur a larger adoption of video games in the home. According to Pong Story, two consoles that largely cloned the Odyssey were manufactured in Europe, the Overkal in Spain in 1973 and the Kanal 34 in Sweden in 1975, while a clone called the Telematch appeared in Argentina, but these systems were produced only in extremely limited quantities. No other company attempted to enter the home market until 1974, and home videos games did not really take off until 1975. This boom resulted from better technology and the popularity of arcade games rather than any success on the part of Magnavox with the Odyssey.

Still, the Odyssey remains an important milestone for being the first designed and patented device that met the original technical definition of a video game, that is an interactive game played through use of a video signal transmitted to a television, as well as being the first video game system released for the home. It also played a crucial role in the evolution of the video game industry greatly out of proportion to its commercial success after Nolan Bushnell and his cohorts at Syzygy Engineering built on Ralph Baer’s concepts to create the first video game to take the United States by storm: Pong.

Computer Space was the first video game product released to the general public, but it was not the first one to be conceived or designed. In 1966, an unassuming, taciturn engineer named Ralph Baer working for a large defense contractor became the somewhat improbable “father of video games” when he decided to do something about his long-standing disdain for broadcast entertainment by designing an interactive game playable on a television. Like Bushnell and Dabney four years later, Baer decided to create a spot-generating system that could place and move dots on the screen through use of a video signal. It is from this video signal — a distinct technology from the vector monitor hardware that powered Spacewar! — that the term video game derives, making Baer the first person to ever design one according to the original technical definition of the medium.

Unlike the story of Atari, which has to be cobbled together largely from (wildly divergent) personal recollections and the occasional deposition, the story of Ralph Baer and his brown box derives largely from the actual documents of the period, carefully preserved by Baer and made available to the general public in a variety of locations. Thus, we have a greater understanding of the birth of the first home video game console than we do on any other topic in early video game history. Little controversy therefore exists around the development of the Magnavox Odyssey, though the occasional fact has been confused or distorted over time, which will be covered in the following posts.

Background

A young Ralph Baer working with electronics

Rudolf Heinrich “Ralph” Baer was born on March 8, 1922, in Pirmasens, Germany. According to an oral history with Baer conducted by the Computer History Museum, his father, a Jewish World War I veteran named Leo, ran a leather tannery supplying the many shoe factories in town. Due to the depressed economic conditions in the region after World War I, the family moved to Cologne in 1924. As a German of Jewish descent, Baer was subjected to increasingly anti-semitic practices after Adolph Hitler came to power and was expelled from school at the age of 14. Baer then attempted to secure a job as a plumber’s apprentice, but was not “Aryan enough” for his potential employer. According to an interview conducted by Tirstan Donovan for his book, Replay, Baer ended up working in an office instead, learning shorthand and typing and performing filing and bookkeeping tasks.

In 1938, when Baer was 16, his family emigrated to the United States just ahead of Krystallnacht. According to the Donovan interview, the quota for Jews immigrating to the United States was very small, but his mother, Lotte, had a large number of relatives in New York, and Baer spoke decent English, enabling him to have a direct conversation with the American Consul in Stuttgart. Baer believes these factors played a decisive role in allowing his family to escape Nazi persecution. According to Harold Goldberg in his book All Your Base Are Belong to Us, the Baer family settled into an apartment building near the Bronx Zoo, and Baer went to work in a factory owned by a cousin where he earned $12 a week putting buttons on cosmetic cases until he saw an ad on the back of a magazine for the National Radio Institute and enrolled in a correspondence course in radio servicing. Per his oral history, upon completing the course Baer took a job with a radio store on Lexington Avenue handling all pickup, delivery, and servicing for the company.

In 1943, Baer was drafted into the United States Army. Despite his radio background, Baer was assigned not to the Signal Corps, but to the combat engineers. After training at Fort Dix in everything from bridge building to landmine disarmament, Baer transferred to Camp Ritchie, Maryland, to train in interrogation techniques because of his German language fluency. Shipped overseas as part of the buildup for the Normandy landings, Baer contracted pneumonia in England and was spared going ashore on D-Day. Afterwards, Baer became part of a special military intelligence unit attached to Supreme Allied Commander Dwight Eisenhower’s headquarters that gave courses in identifying enemy uniforms, interrogating enemy soldiers, and identifying and handling enemy weapons.

In March 1946, Ralph Baer received his discharge from the Army and returned to New York, where he secured a job fixing faulty radios for a manufacturer called Emerson. Bored after three months, Baer quit and explored avenues for continuing his education. Turned down by all the New York colleges because he had no records of his education in Germany, Baer saw an ad for a small unaccredited school in Chicago called the American Television Institute of Technology (ATIT), where he enrolled in late 1946 through the GI Bill. By the time he graduated in 1949, the school had received accreditation, so Baer walked away with one of the very first BS degrees in television engineering.

Upon graduating from ATIT, Baer secured employment at a small medical equipment firm called Wappler Inc., where he built surgical cutting machines, muscle-toning pulse generators, and similar equipment. Feeling the work lacked sufficient challenge, however, Baer departed two years later to take a job at Loral Corporation, a defense contractor formed in 1948 by the combination of two businesses that shared the same building, a machine shop run by William Lorenz and an amplifier maker run by Leon Alpert. In 1951, Loral chief engineer Sam Lackoff decided the company should build a high class television set, so he hired Baer and another man named Leo Beiser to build it. This job would provide Baer his first brush with video games.

While several CRT computer games were developed in the 1950s simulating everything from tic-tac-toe to pool to tennis, no one had ever thought to try and replicate this feat on a standard television set for the very simple reason that doing so would require bulky and expensive electronic components that could not be scaled down for a consumer product. The closest anyone came to trying in the period occurred in 1947 when Thomas Goldsmith and Estle Ray Mann submitted a patent for a “Cathode-Ray Tube Amusement Device.” According to his New York Times obituary, Thomas Toliver Goldsmith was born in 1910 in Greenville, South Carolina, and began building crystal radio sets as a teenager. After graduating from Furman University in 1931, Goldsmith matriculated to Cornell University, where he earned his Ph.D. in 1936. As part of his dissertation research, Goldsmith required an oscilloscope, so he contacted one of the leaders in the field, Dr. Allen DuMont, a brilliant inventor who had developed a long-lasting CRT crucial to the development of the first practical television sets and established DuMont Laboratories around this invention in 1931. After earning his degree, Goldsmith joined DuMont as research director, a post he held until 1965.

At DuMont, Goldsmith became an expert on CRT displays through radar work during World War II. Meanwhile, DuMont Laboratories became heavily involved in the television business and even started one of the first television networks, the DuMont Television Network, in 1946. It was in this climate that Goldsmith and Mann developed and patented their simple game, which consisted of a few resistors, a sawtooth wave generator, and a CRT. According to the patent, the game simulated firing a missile at a target, perhaps taking inspiration from Goldsmith’s radar research during the war. Using a knob, the player would be able to guide the electron beam generated by the CRT across a screen to a target. After a certain period of time passed, which was adjustable by the player, the beam would defocus to simulate an explosion. If the beam defocused while on the target, it counted as a hit. Despite filing the patent, however, DuMont never actually built the game. The reason for this is not clear, though Goldsmith’s obituary points out that DuMont was always strapped for cash during this period, so the company may have simply not had the resources to invest in a new commercial product.

Some have been tempted to label this Cathode-ray Tube Amusement Device as the first video game, but the device fits no definition of the term. There is no video signal, no computer, no software program, and only the simplest of electronics. There are also no graphics, as the targets for the system consist of physical objects affixed to a screen. Basically, the exact same effect could have been created by mechanically controlling a flashlight shining its beam on a piece of paper. The device does deserve recognition, however, as the first attempt to create a game incorporating a CRT. From available evidence, no one else thought to adapt television technology into a game until Ralph Baer in 1951.

As Baer told Donovan for Replay, the team building the television set for Loral had access to various pieces of test equipment that placed and moved lines on the screen. While fiddling around with this equipment, Baer thought it might be fun to build some interactivity into the set, though he was quick to point out to Donovan that he was not necessarily thinking specifically of a game at this point. As Baer explained in his autobiogrphical work Videogames: In the Beginning, however, the project was already behind schedule, so Lackoff forbade Baer to add any new features. According to the oral history, the television project never went anywhere, so Baer decided to leave the company. He almost took a job with CBS, but Lackoff, who was also leaving Loral, offered him five dollars an hour more to work for his startup, Transitron (no relation to the Wakefield, Massachusettes, semiconductor company), which focused on defense work. In 1955, the company moved to New Hampshire to become a subsidiary of Van Norman Industries. When the company hit hard times, Baer jumped ship in 1958 to work for another New Hampshire defense contractor called Sanders Associates. (Note: In the Ultimate History of Video Games, Kent incorrectly places Baer’s move to Sanders in 1955, most likely confusing Baer’s move to New Hampshire with his move to a different company. Baer’s oral history confirms the actual dates.)

Channel LP

TV Game #1, Ralph Baer’s first video game feasibility prototype

Royden Coe Sanders, Jr. was born in Camden, New Jersey, in 1917. According to a 1958 profile in the Microwave Journal, while a junior at the Rensselaer Polytechnic Institute the engineering genius formulated a theory for a radio altimeter that could bounce FM waves off objects to determine the altitude of an aircraft. Told by his instructors that this was too complicated a project for a student, Sanders retreated to his backyard in Audobon, New Jersey, to build it himself. After the Navy showed some interest but refused to entrust such an undertaking to someone so young, one of his instructors, Dr. Irving Wolfe, suggested he approach RCA. Reluctant to turn over his work to a large corporation at first, Sanders finally joined the company when he became concerned that Bell Telephone might develop an FM altimeter before he could do so on his own. The result was the AN/APN-1 altimeter patented in 1940, a staple of U.S. and British military aircraft during World War II.

After the war, Sanders left RCA for Raytheon, where he oversaw the Radar and Missile Division, informally known as “Lab 16.” In this role, Sanders took over development of the Lark guided missile program, which had been started at Fairchild Aircraft in 1945, but had so far been unsuccessful. Lab 16 developed a new guidance system for the Lark and performed the first successful aircraft interception by a surface-to-air missile in January 1950. Sanders subsequently oversaw the beginning of the Sparrow-III and Hawk guided missile programs before a desire for independence led him to recruit ten of his fellow engineers in 1951 to join him at a new firm called Sanders Associates.

Briefly located in Waltham, Massachusettes, Sanders Associates settled into an old textile mill in Nashua, New Hampshire, in 1952, where it proceeded to grow into a Fortune 500 company and the largest employer in the state. According to Sanders’ obituary in the Nashua Telegraph, one of the company’s first projects was a miniature gyroscope marketed by Timex, and it also joined the “Tinkertoy” project that represented one of several attempts to create interchangeable electronic components before the advent of the integrated circuit. The company’s most important contributions were in electronic warfare, however, where it deployed the first viable electronic countermeasure system. According to the Microwave Journal, by the time Baer joined Sanders in 1958, the company employed 8,000 people and brought in sales of approximately $9 million a year.

According to Baer’s oral history, Sanders assigned him to its Equipment Design Division, where he worked primarily on a spying apparatus codenamed BRANDY designed to pickup Soviet radio transmissions in Berlin. Soon after Baer completed the project ahead of schedule, the Equipment Design Division manager retired, so in 1966 Baer was promoted to lead the unit. It was in this context that Baer found himself sitting outside a New York City bus terminal on August 31, 1966, waiting for a colleague to arrive so they could go to a meeting together. For reasons that have never been fully clear to Baer himself, in that moment he found himself once again thinking about how a person might interact with a television set. The next day, he wrote a four page proposal, which has been preserved by the Smithsonian and is viewable in full in Baer’s autobiographical work, Videogames: In the Beginning, for a “TV Gaming Display” that would transmit a video signal to a television through its antenna ports and incorporate an RF modulator oscillating at one of the standard TV channel frequencies so that the television could tune to the signal and display the game. Baer labelled this signal Channel LP (for “Let’s Play”) and proceeded to outline several types of games he felt would be well suited for his system such as driving games with a steering wheel controller, card games, board games like checkers and chess, basic educational software like arithmetic and geometry programs, games of chance like dice and roulette, target shooting games, and a “pumping” game in which each player presses a button rapidly to fill a vessel. On September 6, Baer drew up a rough schematic of what such a device might look like and specified channels 3 and 4 for the device’s video signal, which remained the standard right up until plugging a video game console into a television no longer required an RF modulator in the 1990s.

Soon after drafting these documents, Baer initiated a skunk works project to build a prototype of his new game system. As Baer explained to Kent in The Ultimate History of Video Games, the Equipment Design Division had a staff of 500 people, so no one would notice or even care if Baer took an engineer or two aside and put them to work on a special project in between more important work. Therefore, as Baer recounted in his book and his oral history he asked one of his department managers to lend him a technician to create a feasibility prototype of his TV game using vacuum tubes. The manager loaned him a man named Bob Tremblay, who created the circuitry necessary to interface a Heathkit TV alignment generator with a television via an RF modulator and move a simple vertical line around the screen. Completed in December 1966 and retroactively identified as TV Game #1 by Baer, this simple setup was, in a way, the first video game system. Like Baer’s initial proposal, this system is preserved at the Smithsonian.

Now confident that his game idea had merit, Baer approached the Sanders Corporate Director of Research & Development, Herbert Campman, to officially sanction the project. After viewing Baer’s simple line-moving system in action, Campman approved further development with a modest initial budget of $2,000 for labor and $500 for materials. Sanders was now officially in the video game business.

TV Game #2

TV Game #2, designed by Ralph Baer and built by Bill Harrison

Baer continued to brainstorm game ideas with a fellow engineer named Bob Solomon in December 1966 and January 1967, but his game project did not really start in earnest until February 12, 1967, when he brought a new technician on board named Bill Harrison. Born in Sagamore, Massachusettes, in 1935, William L. Harrison left home in 1953 at the age of eighteen to join the United States Air Force. According to an interview conducted by Benj Edwards, after completing basic training, Harrison was assigned to an electronics course at Kessler Field in Mississippi so he could be trained as a ground radar repairman. After completing his tour of duty in 1957, Harrison joined Sanders Associates, where his cousin was married to one of the founders, and by 1967 he was part of the Ocean Systems Division working on a sonar buoy project. According to Harrison, Baer called one day to ask him to come over and see his TV game prototype before asking him to join the project. According to Baer’s book, he was interested in recruiting Harrison, whom Baer knew because the engineer had been assigned to the BRANDY project for about a week, because he was known to be reliable and also had some television experience from tinkering with sets in his spare time. Harrison said yes, and work soon commenced on the first real system prototype.

According to Baer’s book, he stashed Harrison in a small room on the fifth floor of the main Sanders building on Canal Street and told him to keep their project a secret. The door remained locked at all times, and only Baer and Harrison had a key. Baer gave him a few initial schematics, including a design for a light pen for use with a quiz game in which the player had to point the gun at the correct answer on the TV screen, as well as a 19-inch RCA television he had acquired specifically for the project. Unfortunately, work on the TV game progressed only intermittently because whenever Harrison was needed elsewhere for more important work, Baer would have to let him go, often for weeks at a time. Indeed, Harrison had barely started development when he had to leave the project for three months. During this lull, Baer brainstormed more game ideas with another engineer named Bill Rusch, an MIT graduate known for being highly creative, but very difficult to motivate. On May 10, 1967, Rusch drafted a formal memo articulating multiple game types that emerged from these brainstorming sessions, including a drawing game, two driving games (driving along an endless road or a circular track), a chase game, a maze game, a roulette game, several variations on a baseball guessing game (divide the screen into horizontal bands and have the “batter” guess in which band the “pitcher” will throw the ball), a U.S. geography map game, two target shooting games, a number guessing game, a “fox and hounds” game (a chase game where multiple pursuers chase one target), a soccer game, a golf putting game, and a horse racing game.

Meanwhile, Harrison returned to the project on May 2 and began to modify TV Game #1. He added color to the system and implemented the very first completed game, the pumping game outlined in Baer’s first memo. In what was most likely the first video game ever made (by the technical definition), one player would furiously press a button to raise a blue square on the screen that represented water, while the other player would pound his button to lower the square. An overlay placed on top of the screen contained a drawing of the “bucket” that held the “water.” If the first player could fill the bucket high enough within a time limit, he won, otherwise, the water turned red and the other player won the contest. Subsequently, Baer directed Harrison to implement four additional games, all of which required only one spot, which was all the hardware could produce. These were a second pumping game called “Firefighters,” a one-player variant of the original pumping game in which the player pressed a button to reduce the size of the dot to simulate fighting a fire, “Color Catching,” which was a guessing game, “Roulette,” which simulated the popular casino attraction, and “Car Ride,” in which the dot represented a car that the player had to drive down a road. Once these were completed, Harrison built a few more components that allowed the team to ditch the Heathkit equipment altogether; this became TV Game #2.

Once the duo had the full system up and running, Baer designed the necessary hardware to add a second dot on the screen, which Harrison implemented starting on May 22. This allowed each player to control his own dot and quickly led to the design of the “chase” game outlined in the Rusch memo in which one dot attempted to catch the other. This required two new features in the hardware: collision detection and the ability to make a dot disappear. Both of these functions were sketched out by Baer and then implemented by Harrison on May 25. Next, another engineer named John Mason figured out a way to use random number generation to rapidly switch between elements on the screen and therefore give the illusion of more than two dots. This allowed Harrison to implement the previously brainstormed “fox and hounds” game in June. According to his interview with Edwards, Harrison also built a light gun around this time by buying a toy gun from Sears and retrofitting it so that it could sense dots on the screen and cause them to disappear with a pull of the trigger. In the interview, Harrison takes credit for the idea of doing a “target practice” game, but both Baer’s initial memo and the Rusch memo include the concept, though neither one references a light gun. According to Baer’s book, Harrison had also completed the light pen for the quiz game by this time as well. (Note: Donovan in Replay largely confuses the timeline, stating that all the games were done by March — even the ping pong game that had not even been started yet by June. Baer himself gives the best accounting of the timeline in Videogames: In the Beginning.)

One June 14, 1967, Baer invited Campman back to the lab for a demonstration of TV Game #2. (Note: In Replay, Donovan conflates this meeting with the initial funding meeting at the end of 1966. Once again, Baer’s book is the best source for the sequence of events.) Though impressed by all the games, Campman particularly liked the light gun game and believed that Baer now had a winning product. Campman approved additional R&D funding and indicated it was now time to bring senior management into the loop. The very next day, Baer demoed the system for Royden Sanders, executive VP Harold Pope, and the entire board of directors of the company, who happened to be in town for a meeting. Seven games were demoed: “Chess,” which was actually a chase game in which each player moved a dot one space at a time around a chess board overlay trying to trap his opponent, “Steeple Chase,” a free-form chase game, “Fox and Hounds,” a chase game making use of the random dot hardware to place multiple pursuers on the screen, “Target Shooting” with the light gun, “Color Wheel Game,” a guessing game in which the dot cycles through a series of colors and the players must guess which color will appear, and the two previously described pumping games, which were named “Bucket Filling Game” and “Pumping Game” for this demonstration. According to Baer’s interview with Donovan, neither Sanders nor Pope were particularly impressed, nor were all but two of the company directors. Nevertheless, as Baer describes in his book, when the demonstration ended, Sanders and Pope conferred briefly before formally authorizing the project with the goal of creating a commercial product that Sanders could sell itself or license to another company. It looked like the commercial video game would soon become a reality.

Hard at work on the next blog post, which will cover the early years of Ralph Baer and the development of the Brown Box, but I just wanted to take time out again to mention my new podcast, as today we posted our first look at a substantive issue in video game history after two introductory episodes. Entitled “What Makes an Industry?” the episode explores how the distinct video arcade, home console, and home computer game industries ultimately merged into the global video game industry we know today. Check it out here. New podcasts on the 1st and 15th of every month.

In March 1971, Nolan Bushnell left Ampex to become the chief engineer of Nutting Associates and finally achieve his dream of building a commercial video game. Over the next five or six months, he engineered a game so advanced, it would take at least three years for any other product to approach its combination of representational graphics, physics, and artificial intelligence. Debuted at the MOA show that October in a sleek fiberglass cabinet, Computer Space conveyed a firm statement that the future was here and the coin-op industry would never be the same. Unfortunately, the game also proved alien to distributors and intimidating to the general public. While the success or lack thereof of Computer Space on the market continues to be a point of debate today, there is no doubt that it failed in its overall goal of igniting the video game revolution. While it sold about as many units as a typical pinball machine, it failed to spark much excitement from the established manufacturers, and Bushnell was forced to return to the drawing board.

Nutting Associates

Bill Nutting, founder and president of Nutting Associates

William Gilbert Nutting was born on May 3, 1926, and grew up in River Forest, Illinois. The son and grandson of executives of the Marshal Fields Department Store, Nutting graduated high school in the middle of World War II and entered Army Air Corps cadet training, where he began a life long love affair with flying. According to a profile written in the March 1992 issue of Vintage Airplane, Nutting attended Colgate University for two years after the War and then transferred to Colorado University, where his childhood friend Claire Ullman also attended school. In 1948, Bill and Claire were married, and two years later Bill graduated with a degree in business administration. As stated in a profile in the February 17, 1968, edition of Cash Box, Bill and Claire then relocated to San Francisco, where Bill took a trainee position with the National Motor Bearing Company and then joined Rheem Manufacturing in 1951, where he moved through a variety of jobs from production line foreman to inventory control to purchasing and sales. In 1956, he relocated to Rheem’s Chicago office for a sales and office management position, but in 1959 he returned to California to enter the retail business. According to Goldberg and Vendel in Business is Fun, Nutting’s retail work had him following in his father’s and grandfather’s footsteps by taking a job at the San Francisco luxury department store Raphael Weill & Company — also known as the White House for its beaux-arts facade — where he started as a buyer in the gloves department.

According Cash Box, in 1962 Nutting invested in Edex Teaching Machines, a company established by Eugene Kleiner that same year after leaving Fairchild that built educational devices for the United States Military and other clients. As revealed to me in an interview with Claire Nutting, the connection between Nutting and Kleiner was Claire’s father, a high-level executive at Revereware. Claire’s father became friends with Kleiner and invested in Edex, and he invited Bill to invest as well. One of Edex’s products was the Knowledge Computer, which according to a patent issued in 1965 was designed by engineer Thomas Nisbet and was a coin-operated multiple-choice question and answer machine that incorporated a film projector and buttons for selecting answers. As explained in Cash Box, Nutting took over marketing of the product, and the October 24, 1964, issue of Billboard Magazine reports that Nutting and a man named Howard Starr attended the 1964 MOA show under the name Scientific Amusements — which judging by the October 17, 1964, edition of the magazine was a subsidiary of Edex — to display the Knowledge Computer, most likely to gauge the interest of coin-op distributors. A small number of machines may have even been placed on location, as an article in the August 22, 1964, issue of Cash Box states the game can already be found in “bowling alleys, student unions, and transportation depots.”

Raytheon purchased Edex the next year. According to Claire, Raytheon had no interest in the coin-op business and Bill had long been interested in starting his own company, so he purchased the rights to the machine so he could start marketing it himself. According to the October 23, 1965, edition of Billboard Magazine Bill Nutting marketed the Knowledge Computer through an entity called Nutting Corporation and worked with distributor Advance Automatic Sales to place machines with 20-25 operators in the Bay area. As explained in the February 17, 1968, issue of Cash Box, however, it soon became apparent that the game was too expensive and too hard to service to be a viable product.

According to an article by Goldberg in issue 136 of Retro Gamer, in about 1966 Bill therefore contacted his brother Dave, then working as an industrial designer for the celebrated firm Brooks Stevens Design Associates, to ask for help in redesigning the Knowledge Computer. (Note: Dave Nutting’s relatively short, but highly influential career in the coin-op industry necessitates a fuller biography than the scope of this post allows, so his background will be covered in more detail in a later post.) According to Dave as relayed to Goldberg, the brothers agreed that Dave would design and manufacture the game in his home city of Milwaukee, while Bill would concentrate on selling the game from his home in California. According to Dave as relayed to several authors including Goldberg and Donovan and also relayed in interviews with Dave’s partners Harold Montgomery and Gene Wagner conducted by Ethan Johnson, Claire did not like the idea of the brothers going into business together and insisted Bill call the deal off. This may not, however, be entirely accurate. According to a letter written by Bill to his son Craig that was shared with me by Claire Nutting, Dave had wanted to join Bill’s business and redesign the Knowledge Computer, but Bill ultimately turned him down for personal reasons due to a long-standing sibling rivalry. Bill states that Claire was involved in the decision as a member of the board of the company, but that it was ultimately Bill’s decision alone. Dave’s contention that Claire threatened to divorce Bill if he did not call off the arrangement likewise appears unfounded.

To redesign the Knowledge Computer, Bill established a new company called Nutting Associates in January 1966, and approached a company called Marketing Services for design help. (Note: some sources claim the company was established in 1968, but the January 1966 date is confirmed by an employee handbook given to me by Claire Nutting that includes a brief history of the company. He incorporated the company in February 1967 according to the company’s articles of incorporation). That company assigned an industrial designer named Richard Ball to the project. According to this author’s interview with Ball, he decided to place Nutting’s unit on test at the College of San Mateo and was amazed when he emptied the machine five days later and discovered it was filled to the brim with dimes. Sensing a hit, Ball subsequently redesigned the game for easier manufacturing, most notably by building a new projector. According to the company employee handbook, Nutting then spent a year placing units on location through a franchise system under the name Computer Quiz before moving to traditional coin-op distribution at the MOA show in 1967. According to Ball, this first version of the game relied on copper relays, which created extreme service headaches. Ball therefore approached a company called Applied Technology to design a circuit board that would accept plug-in relays. The next summer, Ball worked with Applied Technology to redesign the game again to eliminate relays entirely. This third generation of Computer Quiz , released according to Cash Box in October 1968, may well have been the first fully solid-state arcade game ever created.

Computer Quiz from Nutting Associates, perhaps the first solid-state arcade game

Computer Quiz hit the industry at the perfect time. Segahad already proven that operators would be willing to accept a larger, more sophisticated game far different from the traditional pinball table and had also established that the public would accept a machine set for quarter play. Furthermore, the game launched during a period when the industry was still fighting for legitimacy due to the continuing stigma of association with organized crime, so a game with a perceived educational value proved a perfect lead-in product for locations that would not accept pin games or similar amusements. As a result, in a time when the typical pinball game might sell 1,500 units and a hit would only sell around 3,000 both Goldberg and Donovan report that Nutting sold 4,400 units of Computer Quiz, while Nutting Industries sold another 3,600 units of Dave’s version, which he called I.Q. Computer. Along with Periscope and Speedway, Computer Quiz played a critical role in the arcade game renaissance of the late 1960s that ultimately resulted in the birth of the video arcade game industry.

While Computer Quiz proved a sizable hit, Nutting Associates soon ran into difficulties. According to former company general manager Ransom White as told to coin-op historian Keith Smith, the company was only marginally profitable, perhaps due to Nutting’s decision to bypass distributors and sell to operators directly in the early days, many of whom White felt were shady characters. This view is supported by Ball, who came away from his time with Nutting believing that the entire coin-op industry was controlled by the mob. Furthermore, according to Ball the company never had a particularly competent engineering department — after all, they had to rely on an intern to even build their first solid-state design — which made coming up with a follow up product tricky. According to Ball, he warned Nutting in 1968 that Computer Quiz would soon run its course and created a marketing brief for a video product to replace it, but he and White were both fired soon after for objecting to Nutting buying an airplane using company funds. (Note: No one else has come forward to corroborate Ball’s claim that he proposed some form of video game to Nutting in 1968, but if he did, this could explain why Nutting would be willing to experiment with the concept with Bushnell in 1971.)

With White, Ball, and sales executive Lance Hailstone departing, Nutting was forced to refresh his executive staff and hired Rod Geiman to serve as executive vice president and Dave Ralstin to serve as sales manager. According to this author’s interview with Bushnell, before long Nutting himself was spending most of his time tinkering with his planes while Geiman ran Nutting Associates. According to Billboard Magazine, in December 1968 Nutting moved from its 4,500 square foot facility to a much larger 18,500 square foot location as Geiman prepared to expand the company into new markets. The next year, the company launched a sports trivia game called Sports World and a horrorscope machine called Astro Computer, but the company’s main business remained releasing updated questions for Computer Quiz, which could not sustain the company much longer. Therefore, when Nolan Bushnell showed up in early 1971 with his own game idea and agreed to become the chief engineer the company desperately needed, Nutting lept at the chance to hire him.

Creating Computer Space

The memory circuit board for Computer Space. Note the diodes laid out in the shape of the spaceships.

When Bushnell joined Nutting, he had a basic hardware system that could move dots around the screen and a vague idea to make a product like Spacewar!, but he did not yet have a fully formed game concept. In fact, according to his 1976 deposition at one point he even toyed with moving to a simpler concept by just designing a piloting game in which the player controlled a spaceship and dodged asteroids. In the end though, he decided to press on with a shooting game, which by the end of January 1971 had acquired the working title Cosmic Combat. The limitations of the hardware necessitated some changes from Spacewar!, however. Gone was the sun and its gravity, the hyperspace function, and two-player combat. Instead, Bushnell crafted a game in which the player controls a rocket ship and attempts to shoot down two flying saucers that also shoot back at him. Both the player and the saucers score a point each time they destroy one another. The game lasts for ninety seconds. If the player has more points than the saucers at the end of the round, he gets another ninety seconds of play; otherwise the game ends. (Note: In the Ultimate History of Video Games, Kent claims that Computer Space played just like Spacewar! complete with gravity and hyperspace, but just observing footage of the game demonstrates this is clearly false.)

While there is a great deal of disagreement between Bushnell and Dabney over who did what when building the motion control prototype, there is much less controversy over the creation of the game itself. As described by Goldberg and Vendel, Bushnell’s deal with Nutting was that he would join the company as chief engineer and work on Nutting products during business hours, while working on his video game after hours and on weekends. Bushnell insisted on this arrangement so that Nutting would not acquire shop rights to his video game technology, which remained the property of Syzygy Engineering. When the game was completed, Nutting would manufacture and sell the game and give Syzygy a five percent royalty on each cabinet sold. Dabney, meanwhile, remained at Ampex until the summer, when Bushnell’s progress convinced him they would be able to make a go of it, and he resigned to join Nutting as well.

Once work on the game shifted to Nutting, the majority of the engineering was completed by Bushnell. According to Benj Edwards’s article on the development of the game, Bushnell spent his days hunched over a drafting table just outside his office door at Nutting plotting out the circuitry that would tell the spot generator where to place dots on the screen and how they should interact with the player’s controls. He also created the graphics for the game, rendering the player’s ship and the enemy saucers as a series of dots and creating a series of routines that allowed them to rotate smoothly. In one of his more clever feats of engineering, Bushnell used mirroring techniques so that he would only have to store four different ship positions in memory rather than the sixteen needed to cover every possible facing. He also chose to lay out the diodes used for the graphical memory — mask ROM being far too expensive at the time — in the shape of the ships themselves, which allowed operators to easily figure out which diode needed to be replaced in case of malfunction. Finally, Bushnell crafted the AI of the hardware-controlled opponents by dividing the playfield into quadrants and giving the saucers the ability to detect which quadrant the rocket ship was currently in so they would fire in that direction.

In one of the rare cases of agreement between Bushnell and Dabney on engineering matters, Dabney concurs that Bushnell completed all the work outlined above, though he does claim that Bushnell came to him for advice on how to implement several features. However, Dabney also claims in his Retro Gamer Roundup interview that Bushnell had help in designing the circuits from Steve Bristow, a young engineer interning at Ampex who later became a key Atari employee. In both an interview in Retro Gamer issue 75 and in a Computer Space retrospective in issue 93, Bristow has confirmed that he did help build the motion control and memory boards used in the game, but in Edwards’s article he concurs with Bushnell that he was not involved in any of the design or layout, just the construction.

According to Edwards, Dabney concentrated on the mechanical and analog engineering required to turn the game into a finished product, building a power supply, developing a working coin mechanism, implementing the controls, and constructing a wooden cabinet in which to house the game. According to both Edwards and Retro Gamer 93, he also developed the sound for the game by taking a voltage regulating diode that generated pink noise and attaching an amplifier and integrator that allowed for changes in volume. According to his Retro Gaming Roundup interview, Dabney also came up with the idea of inverting the video every time the player cleared a round to provide a sense of progression. The duo identified the reverse-color screen as “hyperspace.” According to Goldberg and Vendel, Bill Nutting provided the final name for the game, Computer Space — a variation on the name of the company’s first hit, Computer Quiz — while Edwards claims it was Ralstin.

According to Goldberg and Vendel, in August 1971 the game was far enough along that Bushnell and Dabney decided to do a location test, an important step in the arcade industry in which a prototype game is placed on location and the coin-drop is measured to see if the game is shaping up to be a hit. (Note: Both Donovan and Retro Gamer place the test in November 1971, but this is clearly far too late: Nutting was already taking orders for the game at the MOA show in October, and location tests always occur before the game is made available to distributors. These sources have apparently confused the location test date with the most commonly claimed general release date.) Dave Ralstin ran a coin route on the side to generate extra income, so Nutting chose to place the game in a bar on the route frequented by students of Stanford University called the Dutch Goose. Packing the prototype unit in Dabney’s Datsun pickup truck, Bushnell and Dabney brought the game to the bar and watched as players flocked to the machine. It looked like the duo had a hit, but a second test at a pizza place did not go nearly so well. Like Spacewar!, Computer Space used a multi-button control scheme and realistically depicted the physics of movement in a zero-g environment — in which an object continues to move in the same direction until a force is exerted in the opposite direction. The Stanford engineering students at the Goose, some of whom were probably Spacewar! veterans, caught on right away. The working class patrons at the pizza place did not.

Galaxy Game

Bill Pitts (l) and Hugh Tuck working on the first version of Galaxy Game

Not long before putting Computer Space out on test, Bushnell learned that he was not the only person working on an arcade adaptation of Spacewar!, though after meeting his competition and observing their work, he decided they were not a threat. According to a testimonial he wrote for the Stanford alumni magazine, Bill Pitts was a Palo Alto native interested in chemistry and physics who matriculated to Stanford University in the Fall of 1964. Pitts quickly signed up for an electrical engineering class and received his formal introduction to computers when an EE professor discovered his interests and helped him push back his “History of Western Civilization” requirement so he could take the brand new “Introduction to Computer Science” course being offered by George Forsythe. According to an interview conducted by coin-op historian Keith Smith for his book All in Color for a Quarter, Pitts ultimately graduated with a degree in statistics, Stanford not having a computer science degree at the time, but he had the opportunity to take high-level courses in computer programming because the statistics department allowed students to take graduate courses as part of their undergraduate degree in an effort to recruit more students to the major.

According to Donovan and Smith, Pitts also enjoyed the unusual hobbies of breaking into university buildings and exploring the maze of steam tunnels beneath the campus. As relayed to Donovan, in 1966 Pitts was en route to a bar when he passed a driveway leading off into the hills about five miles from the center of campus. From the sign at the foot of the drive, he could tell it led to a university building, and it was one that he had never broken into before. He returned several hours later with the intent of breaking and entering only to discover all the doors were unlocked. Entering the building, Pitts observed brightly lit rooms and a PDP-6 computer. He had unwittingly just discovered the Stanford Artificial Intelligence Laboratory. Already enamored with computers, Pitts convinced Lester Earnest, the man in charge of overseeing SAIL, to allow him to log computer time when no one else was using the system. Soon, classes were completely forgotten as Pitts began engaging in all night coding sessions.

According to Smith, Pitts had already been exposed to Spacewar! on a PDP-1 in Polya Hall before he discovered SAIL, but hanging around the AI lab gave him the opportunity to play it more frequently and share the game with others. As explained by Donovan and the John Markoff book What the Doormouse Said, one person with whom Pitts played the game was his high school buddy Hugh Tuck, whom he would take up to the lab whenever he was back in town from California Polytechnic State University in San Luis Obispo. According to Donovan and Markoff, Tuck remarked one night that if someone could stick a coin slot on the computer, that person could probably become rich. (Note: Donovan claims this exchange took place in 1966, while Markoff claims 1969. In his alumni magazine testimonial, Pitts claims the exchange took place three years before he started working at Lockheed, which would be 1968 if Markoff’s date for his employment is correct. 1968 seems more reasonable than 1969 if only because Pitts graduated in 1968 and may not have been hanging out in the AI lab anymore. Either way, Donovan has probably placed the event too early.) There was no way to package a PDP-6 and a display cheaply enough to create a commercial game, however, so the duo never tried to take the idea any further. In 1971, however, Pitts took a job at Lockheed as a PDP-10 programmer, but had to wait until the computer actually arrived before he could do any work. During this idle time, Pitts noticed that the year before, DEC had released a new computer called the PDP-11. Designed as a successor to the PDP-8 and initiated after the PDP-X debacle and the defection of Ed De Castro to start Data General, the 16-bit PDP-11 occupied roughly the same niche as the Nova and retailed for just $12,000. Pitts thought back to Tuck’s idea to recreate Spacewar! as an arcade game and decided that with a PDP-11 it just might work.

From Smith, the hardware Pitts used to create the game consisted of a PDP-11/20 with 8K of memory, a Hewlett Packard 1300A Electrostatic Display, and a point-plotting display interface designed by a man named Ted Panofsky. A coin box was provided by jukebox company Rowe International, while Pitts purchased used B-52 joysticks from San Carlos military surplus store J&H Outlet for use as controllers, commercial joysticks being virtually nonexistent at that time. According to Donovan, Pitts assembled this hardware system and programmed the game, while Tuck, a mechanical engineer, designed the cabinet, which was actually engineered by a firm in Palo Alto. Tuck, who came from a wealthy family, also provided the bulk of the $20,000 required to build the machine. According to Donovan, the funding came from Tuck’s parents, but in Pitts’s Stanford testimonial, he says that he, Tuck, and Tuck’s brothers and sisters provided the cash. As the game neared completion, Pitts and Tuck established a company called Computer Recreations, Inc. in June 1971 in anticipation of selling it. Originally called Spacewar! just like the original, Pitts changed the name at the last minute to Galaxy Game due to the profound antiwar sentiment currently pervading area college campuses.

The second version of Galaxy Game, completed in 1972

According to a business plan written by Pitts and Tuck in early 1972, they installed the first version of Galaxy Game in the Tresidder Union on the Stanford University campus in a music listening room on the second floor in November 1971. The massive walnut cabinet included seats for the player to encourage extended playing sessions and housed the monitor and controls. The PDP-11, meanwhile, resided in the attic and was connected to the cabinet by a 100-foot cable. Unlike Computer Space, Galaxy Game was a faithful recreation of Spacewar! complete with hyperspace and the central sun and even allowed the player to choose whether or not to use the sun, whether to use faster or slower ships and faster or slower torpedoes, and whether or not to allow ships to wrap around to the other side of the screen. Play was set at a dime per game or three games for a quarter. According to Pitts, the game was an instant hit as long lines of eager players waited an hour or more for a chance on the machine. In an email correspondence with historian Marty Goldberg, Pitts said they even briefly installed a second monitor hanging above the cabinet so people in line and other passers by could observe the unfolding action.

As Pitts told Smith, the initial version of the game was never meant to be a commercial product due to its cost: its only purpose was to gauge public interest in a Spacewar! arcade game. With the prototype proving a hit, Pitts and Tuck progressed to version two. This version would be placed in a fancier blue fiberglass cabinet, while the computer would drive four monitors instead of just one in order to make the whole system cost effective. These monitors could each run separate games, or they could be linked to allow more than two players to play in the same game. Building the new system ran the cost of the entire project to $60,000. In June 1972, this version was installed in a coffee house in the Tresidder Union, though it had to be cut down to only two monitors to fit into the space allotted by the University. (Note: The June 1972 date reported by Smith comes from a summary of the game’s creation posted by Pitts on a Stanford website in 1997. At the 2013 California Extreme Show, Pitts gives a September 1972 date instead, but as this talk came another sixteen years after the fact, I find this claim less reliable. My guess is he was confusing the installation of the first version, which Pitts has erroneously claimed happened in September 1971, with the installation of version two.) Once version two went live at Stanford, Pitts carted version one to other locations around town, but it never did as well as the installation on campus.

According to Pitts’s 1997 testimonial, version two remained in operation until May 1979, when it had to be retired because the display processor had become unreliable. According to Pitts, the game remained popular right up until the end, with clusters of a dozen or more students gathered around the game on any given Friday or Saturday night during the school year. He had long since given up on turning Galaxy Game into a commercial product by then, however, as even running multiple games off a single PDP-11 resulted in a price tag that was simply too high. Nevertheless, Pitts claimed to Smith that by the time Galaxy Game had been retired in 1979, he had recouped the $60,000 cost of developing the game.

Selling Computer Space

Computer Space, which shipped in a variety of colors, in its final form

Roughly a month before Galaxy Game debuted at the Tresidder Union, the Nutting Associates team flew to Chicago to attend the MOA show, held that year from October 15-17 at the Conrad Hilton Hotel. The original prototype debuted at the Dutch Goose had been housed in a simple wooden cabinet built by Dabney, but by the MOA, the game now sported a futuristic-looking fiberglass cabinet, which according to Edwards was designed by Bushnell using modelling clay and then built by a seamless swimming pool manufacturer named John Hebbler located by Dabney. The controls were placed on a lighted panel jutting out from the cabinet and consisted of four buttons — two for left and right rotation, one for thrust, and one for firing. According to Goldberg and Vendel, after initial tests demonstrated the buttons might be too complicated a control scheme Bushnell and Dabney had hoped to use a metal joystick-like device for movement, but it proved too fragile and broke the first night that version went out on test. The panel bore the Nutting Associates name and logo, but in a nod to the game’s creators, it also included the phrase “Syzygy engineered.”

According to Edwards, Nutting brought four cabinets to the MOA show in an attempt to make it appear the game was already in production, though in truth these were the only four copies of the game in existence. Each game was housed in a different color cabinet — yellow, red, white, and blue. Disaster nearly struck when they discovered the monitors had all broken loose from their cabinets during shipping, but Bushnell and Dabney were able to repair three of the units. The fourth was left open as a display of the internal components of the system, a clever ploy to mask the accident from distributors. How well the game performed at the show is a matter of some debate. In his 1976 deposition, Bushnell claims no orders were taken at the show. When speaking to Edwards in 2011, however, he claimed that distributors felt it would be worthwhile to try the game out, and they came away with a “good order book.” Goldberg and Vendel claim that Nutting took a handful of orders. All sources agree, however, that no one quite knew what to make of the game. In Steve Bloom’s Video Invaders, Bill Nutting claims the game “blew the industry’s mind,” while Goldberg and Vendel emphasize that distributors were skeptical of the game’s reliability and play value while also fearing that hoodlums would steal the TV right out of the cabinet. The game must have generated at least some interest, however, as Goldberg and Vendel report Nutting took Bushnell and Dabney for a flight in one of his planes to celebrate after they returned to California and ordered a respectable production run.

According to Smith, Nutting displayed the game one more time at the International Association of Amusement Parks and Attractions show from November 9-12 and then began shipping the game before the end of the year. According to most sources, including Edwards, the game shipped in November, though in his 1974 deposition, Bushnell remembers the game shipping in December, or even in early January 1972. Kent claims in his book that a man named Keith Feinstein acquired documents that prove the game was shipping before the end of 1971, but he does not elaborate. The November 27, 1971, edition of Cash Box magazine contains an ad for the game claiming it is already available from distributors, strongly implying it had already been released by that point, but an article in the December 4 issue states the game is “being readied for U.S. Distribution,” which implies it is still forthcoming.

The number of units built also varies depending on who tells the tale. Bushnell stated in Retro Gamer that they produced around 2,200 units, but Nutting claimed to Bloom in Video Invaders that he built just 1,500 units. As this interview came closer to the events in question and the source was the person actually in charge of the company, I tend to believe the lower figure. Either way, this was an ambitious initial manufacturing run in a time when 2,000 units constituted a decent hit.

According to Nutting in Video Invaders, Computer Space faced a mixed reception, with some of the more more progressive distributors interested in the game, but most feeling the game held little merit. This claim is backed up by individual anecdotes. For example, Smith reports that Portale Automatic Sales in Los Angeles became the game’s biggest champion and largest distributor, while Donovan reports that Empire Distributing in Chicago, one of the largest distributors in the country, felt video games were a passing fad and had no interest in the game. According to Goldberg and Vendel, Dave Ralstin overcame some initial skepticism by giving away the first five machines off the assembly line to five of the largest distributors in the country. The ploy must have worked, for Goldberg and Vendel report that by spring 1972 the game had sold 1,000 units. Both Bushnell and Dabney have claimed in separate interviews, however, that with the game starting to become successful and Ralstin earning a nice commission on each unit, Nutting decided to dismiss him and sell the game himself. According to Goldberg and Vendel, sales dropped off quickly after that. This story may not be strictly true, however. While sourcing on Nutting Associates is difficult to come by, the May 13, 1972, issue of Cash Box identifies Ralstin as still being the sales manager at Nutting. While its still certainly possible that Ralstin was dismissed because Nutting felt his commission was too large and his services were not needed, I imagine that Computer Space sales were probably largely complete by that point anyway and that his dismissal therefore had little effect on the fortunes of the game. On the other hand, Bob Portale praises sales of Computer Space in the same issue, so its possible that the game was still selling, at least in some parts of the country.

Final sales figures for Computer Space are not known. Bushnell stated to Retro Gamer that he believed they sold 2,200 units, which seems high, but in his 1976 deposition, he placed the number at between 1,300 and 1,500 units. Goldberg and Vendel claim 1,500 units as well, while Edwards claims between 500 and 1,000 units, which is almost certainly too low. Kent claims Nutting built 1,500 units but failed to sell them all. Considering Nutting’s claim of a 1,500 production run and some difficulty enticing distributors to buy the game, Bushnell’s 1976 estimate of 1,300 to 1,500 units appears to be the most accurate.

So was Computer Space a success? That is a difficult question to answer. As Donovan points out, sales of 1,500 units were nothing to be ashamed of in the early 1970s, and Bushnell has claimed in several interviews that the game grossed $3 million, though this figure is probably a little high. According to Edwards, Dabney remembers being disappointed by the game’s performance, yet Bushnell remembers it as a modest success, though one he felt could have been bigger. In his memoir Lucky That Way, former Activision producer Brad Fregger recalls being hired by his friend Rod Geiman to collect coins along Nutting’s game route and being impressed by how many quarters Computer Space took in. Nutting must not have been too disappointed with the game’s performance either, as he ultimately negotiated with Bushnell to create a two-player version of the game, and a flop does not get a sequel.

On the other hand, the game only sold modestly well and failed to excite most distributors. Nutting claims to Bloom that he had to “force” some companies to take the game, while Kent states he could not sell the whole production run. Also, while 1,300 to 1,500 units was not a bad showing for the period, it paled in comparison to the biggest hits of the day like Speedway and Nutting’s own Computer Quiz. According to Bushnell as told to authors from Kent to Edwards, working-class bar patrons, one of the coin-op industry’s most important demographics in those days, were unable to grasp the complex controls and realistic physics and soon tired of the game. Furthermore, in an industry where a hit product was guaranteed to be knocked off a dozen times over, only one other company, a small Burbank firm called For Play Manufacturing, ever created a Computer Space clone, while the big manufacturers in Chicago could not be bothered to adopt video technology at all. Therefore, while Computer Space did not really perform poorly, it failed to interest the industry or the public in pursuing video games further.

Despite the mixed reception for Computer Space, Nolan Bushnell remained convinced that the future of popular entertainment lay with the video game. He therefore resolved to move forward with new products, either in partnership with Nutting or through an agreement with one of the big Chicago firms. Bushnell realized, however, that he would need a more accessible game for his next project. While Bushnell mulled his next step, Nutting learned in May 1972 that yet another group was attempting to create a video game, so once again Bushnell decided to scout out the competition. Unlike Pitts and Tuck, however, this group was not looking to create an arcade cabinet; they were preparing to bring video games into the home.

I should have another post wrapping up the Computer Space saga sometime this week, but in the meantime I wanted to interrupt our regularly scheduled programming to announce a new initiative: a They Create Worlds podcast. The format will just be my friend Jeff and I talking about various topics in video game history. We aim to post two a month (1st and 15th), and they will run about an hour each. The first two will be introductory episodes before we start tackling issues in more depth in a sort of documentary interview style. The first episode is now live at podbean, and it will hopefully be up soon on iTunes as well.

In the summer of 1970, Nolan Bushnell, Ted Dabney, and Larry Bryan prepared to change the world. With a vague plan, virtually no funding, and a partnership that consisted of a name and little else the trio began an ambitious project to turn Spacewar! into a commercial product that could entertain teenagers and adults at fun spots and arcades. Unsurprisingly, virtually nothing went according to plan. Nevertheless, after months of prototyping, redesigning, and compromising Bushnell believed he finally had his game by the beginning of 1971 before he realized he had made a crucial calculation error and that a minicomputer would not run his game economically after all. Bushnell’s dreams could have died right then, but in a eureka moment, the budding entrepreneur realized that he and Dabney — Bryan having been abandoned long since — had built such versatile TTL circuitry that a computer was not really needed at all. After a quick redesign and a fortuitous encounter with one of the only American arcade game manufacturers outside of Chicago, Bushnell’s game, ultimately dubbed Computer Space, was well on its way to entering production.

Despite being a relatively simple game created by just two people over a period of just a few months, there are few games with as controversial and convoluted a history as Computer Space. This is because for decades the only account of the game’s creation came from Nolan Bushnell. When Ted Dabney emerged forty years after the fact to pass along his memories of the game’s creation, a completely different story emerged, one which Bushnell continues to vehemently deny. As with most controversies involving credit and responsibility, the truth probably lies somewhere in between. In this post, I hope to reconcile these stories as best as I can under the circumstances.

Converting Spacewar!

The Data General Nova 1200, which may have been the target model for Bushnell’s Spacewar! arcade game

In the summer of 1970, the informal Syzygy partnership began its project to recreate Spacewar! as a coin-operated game, with Bushnell handling the electronic engineering, Dabney focusing on video engineering, and Bryan handling software. The first important task was choosing which computer to use to play the game. Bushnell has stated in many interviews that it was a sales flyer for the Data General Nova that first sparked his interest in recreating the game for the arcade, but the trio still surveyed the minicomptuer market carefully to make sure that they settled on the cheapest computer with enough processing power handle the job. According to Bushnell’s 1976 deposition, sometime around August 1970 the trio acquired a catalog comparing the prices and features of all the minicomputers on the market. After studying these listings, the trio decided the Nova was indeed the proper computer for the task.

According to Bushnell’s deposition, Bryan began work on the computer program even before the choice of computer was finalized, placing this work in mid-Summer 1970. This also lines up well with Bryan’s recollection that he did his work about six months before Bushnell approached Nutting Associates to manufacture the game. According to Goldberg’s interview with Bryan, the programmer spent a couple of weeks tinkering with the program in his spare time before deciding that there was no way they would ever be able to get a Nova computer to play four to six games of Spacewar! at a decent speed. Bryan delivered these preliminary results to his partners and then passed into history. Based on his deposition, Bushnell appears to have continued working on the minicomputer problem for several more months, so he would have probably brought Bryan back into the loop if they had moved forward with that plan, but it was not to be. Indeed, Bryan must have continued to be on Bushnell’s mind for some time after the summer, for according to Dabney in his Computer History Museum oral history when it came time to formalize the Syzygy partnership, Bushnell brought up Bryan, and Dabney responded that since he never paid in his $100 (which, of course, Bryan maintains that he was never asked to do), Bryan was out of the group.

What happened next depends on whom you ask. In Donovan’s Replay, Bushnell described a process of whittling down the computer program by transferring more and more functionality like the background star field and gravity to specialized TTL hardware in an effort to salvage the project. According to Donovan, this work was unsuccessful, and by Thanksgiving the project was dead. Dabney, on the other hand, has claimed in interviews that work halted completely when a computer program did not appear feasible and did not start up again until one day, out of the blue, Bushnell asked him if it would be possible to control the movement of the spaceships on the television screen using a pure hardware solution. Based on Nolan Bushnell’s deposition and the accompanying evidentiary exhibits, it appears that Bushnell’s account to Donovan, while not entirely accurate, is closer to the truth than Dabney’s. From Dabney’s interviews, however, it appears that Bushnell was doing a lot of brainstorming without Dabney and only periodically keeping him in the loop, so it may be Dabney was simply unaware at the time of the effort being put into the project.

Bushnell’s deposition demonstrates that work continued on a computer-based system through at least January 1971, contradicting his recollections to Donovan that the project was dead by Thanksgiving. The January date is set by one of the few pieces of documentary evidence from the period: a letter from Nolan Bushnell to Data General salesman Bob Washburn dated January 26, 1971, in which Bushnell states his intent to order several Data General Nova computers. In his deposition, Bushnell explained that by this point the basic system for the game had been sketched out, and he now needed some actual computers to make sure it worked. Schematics provided by Bushnell at the deposition also prove that several portions of an interface between the Nova and a television had been designed by this point, demonstrating that work had continued on the project above and beyond what Bryan had contributed to the software. According to Bushnell’s deposition, the minicomputer project only died sometime between January 26 and a followup letter from Bob Washburn dated February 16, 1971, that was also entered into evidence. According to Bushnell, he initially believed he had solved the timing problems from Bryan’s initial designs (most likely through moving some functions to specialized hardware as he claimed to Donovan since he was not a programmer and could therefore not alter Bryan’s code too much) and was looking to get some time on a local Nova computer to do a final pass on the system. At that point, a person at the facility to which Bushnell was attempting to gain access pointed out a flaw in Bushnell’s calculations, thereby illustrating that a computer would not work after all. At this point, Bushnell had a eureka moment and decided to do the entire game with custom-built hardware.

A New Hardware System

Ted Dabney’s House, where the prototype hardware that ultimately became Computer Space was built

Perhaps the biggest bone of contention between Bushnell and Dabney is the creation of the spot generating and motion circuitry that proved critical to abandoning the minicomputer in favor of a custom hardware solution. In his oral history and Retro Gaming Roundup interview, Dabney claims Bushnell came to him one day and asked him why adjusting the vertical hold on a television caused the screen to move back and forth and whether they could do something similar to move their spaceships across the screen. Dabney said this should be possible, so Bushnell asked him to build a system to do so. Dabney then set up a makeshift lab in his daughter’s bedroom to create the prototype. When it was finished, Bushnell took the circuit board with him and secured a contract to make a game based around this hardware.

Bushnell has vehemently denied this version of events on several occasions, including an interview with this author. According to Bushnell, he would have never needed to ask Dabney how a television worked because he had been repairing them for years. Also, he maintains that all of the digital engineering on the project was done by himself alone, and that Dabney was only involved in analog work like a monitor interface and power supply. Furthermore, he has stated to numerous authors over the years, including Kent and Donovan, that he was the one who set up a lab in his daughter’s bedroom to make the game. This dispute between the partners is not easy to unravel.

First of all, there is one area where Dabney appears to be mistaken: Bushnell likely never came to him to build a spot generating and motion system to replace a computer. The January 26, 1971, letter clearly demonstrates that Bushnell was still working on a computer system after the motion circuitry had been developed, so there was no need at the time to do an end run around the Nova. In his deposition, Bushnell explains that the motion circuit board was an “exercisor,” that is a system built to simulate the actual computer that would ultimately be used. According to Bushnell, they built this exercisor so they could make sure their other hardware was working properly. If they just tested everything directly with the Nova, they would not be able to tell if any problems stemmed from the hardware or the computer software. According to Bushnell, it was only after he learned in late January or early February 1971 that a Nova would definitely not work that he hit on the idea of using the already existing motion circuitry in its place.

On the other hand, it appears that Bushnell’s long-held contention that the early game hardware was built in his daughter’s bedroom is probably a myth. In his oral history, Dabney states the hardware was built in his daughter’s bedroom, and interviews conducted with Dabney’s daughter by Marty Goldberg and Curt Vendel for their Atari history book appear to corroborate Dabney’s recollections. Even Bushnell admitted in a Retro Gamer article on the making of Computer Space that at least some of the work was done at Dabney’s house. Of course, Bushnell also reconfirmed in that interview that he did work in his daughter’s bedroom as well. Dabney counters that Bushnell’s wife would have never let him bring so much as a soldering iron into their house. Admittedly, in this case we only have Dabney’s word versus Bushnell’s recollections, so the only evidence we have to go on is the character of the individuals involved. In the 1970s, Bushnell often took full credit for creating both Computer Space and Pong, which we now know is not true. Furthermore, he has always claimed that he first saw Spacewar! at the University of Utah, which is also probably not true. Dabney, on the other hand, never sought the limelight, never sought to take credit for any accomplishments, and only told his side of the story forty years later after he was tracked down by historians. While this does not automatically render him free of any agenda, it does mean that he is not likely letting a need for self promotion cloud his recollection of events. Therefore, I conclude, like Goldberg and Vendel in their book, that the preliminary work was done at Dabney’s house, not Bushnell’s.

This leaves open the question of who should get the credit for creating the motion circuit board. This is a question that will probably never be answered. Dabney’s contention that Bushnell had no idea how the vertical control on a television works seems a bit suspect, as he did do TV repair work in high school and college. Even if he was just “switching tubes around” and did not have the knowledge or skill to do sophisticated repairs, I find it highly unlikely that an individual as insatiably curious as Bushnell with an electrical engineering background and direct experience working with televisions would not have any inkling as to how they worked. Its also worth noting that in his 1976 deposition, he describes how the motion control hardware works and displays an impressive command of the entire system. Granted, this deposition was conducted years later, so he had plenty of time to refine his knowledge of the technology, but he did very little engineering work after creating Computer Space, so its hard to imagine that he gained most of this knowledge after the fact. Therefore, Bushnell’s deposition shows that at the very least he was capable of understanding the engineering behind the hardware even if he did not create it himself. On the other hand, if Dabney’s house was the primary staging area for building the motion circuitry, it would make sense that Dabney led the effort to design it. Dabney was also the more experienced engineer when it came to working with video circuitry, having spent most of his career at Ampex doing just that. Therefore, while I am not convinced Bushnell was as ignorant as Dabney claims, I do think Dabney must have taken the lead in developing the motion control board. A potential smoking gun appears in Bushnell’s 1976 deposition in the form of a drawing entered into evidence that is dated January 26, 1971, entitled “Position and Line Counter Cosmic Combat” that is marked “drawn by S.F. Dabney.” If Dabney is the one drawing the schematics portions of the spot generating hardware, he is probably also the one designing it. Regardless of who built it, however, both engineers agree that the motion control board was Bushnell’s idea.

Whether built primarily by Bushnell or Dabney, by early 1971 the partners had completed a motion control circuit board that could hook into a television or monitor and generate a dot on the screen that could be moved around by flicking toggle switches on the hardware. According to an interview conducted with Bushnell by Kent for The Ultimate History of Video Games, the parts for this system came primarily from Ampex, which allowed employees to take small numbers of cheap components for personal projects, and Marshall Electronics, where Bushnell knew salesmen that were happy to provide free samples in return for a promise of an order if the project ever came to fruition. According to Kent, a used television purchased at Goodwill completed the system.

By early 1971, Bushnell and Dabney also finally had a real company. While they had been working under the Syzygy name since at least the summer of 1970, they had never done any work to formalize the relationship other than a vague promise to contribute $100 each that was apparently not even conveyed to one of the partners. In either December 1970 (according to a prospectus prepared by Atari in 1975) or January 1971 (according to Atari’s FY 1973 financial statement) Syzygy Company was formally organized as a partnership between Nolan Bushnell and Ted Dabney. The catalyst for this event was most likely the impending order of computers from Data General, as Bushnell would have definitely wanted to present a real business entity to such an important supplier.

In nearly every account of the founding of Syzygy/Atari from Cohen to Kent to Donovan, Bushnell and Dabney are said to have contributed $250 each to start the company, though all of these authors have confused the timeline. Kent, in one of his more egregious errors, states that Bushnell, Dabney, and Bryan came together to found Atari in June 1972 by each agreeing to chip in $250, conflating the founding of Syzygy in 1970 with the incorporation of Atari two years later. Cohen meanwhile, correctly states that Bushnell, Dabney, and Bryan were all supposed to chip in $100 to create a partnership, but goes on to say that after Bryan pulled out, the other two upped their contributions to $250. Like Kent, he places these events at the incorporation of Atari in 1972 rather than in 1970-71. Even Donovan, generally accurate in his recounting of video game history, places these $250 contributions at the founding of Atari in 1972. A look at Syzygy’s financial statement for the year ending December 31, 1971 and Syzygy’s balance sheet dated June 30, 1972, shows that none of this is accurate. First of all, the contributions were definitely made at the start of the Syzygy partnership and not at the incorporation of Atari, because the 1972 balance sheet shows that the company controlled cash in excess of $6,000 at that time (derived from several income sources that will be discussed in a later post). The 1971 balance sheet further proves that the ownership contributions were made during that fiscal year, though it records $350 from each partner rather than $250. As discussed previously, this has led Goldberg and Vendel to claim in their history that the initial contributions for the company were $350 each. Most likely, Bushnell and Dabney contributed $100 soon after the informal partnership came into being in summer 1970, as stated by Dabney and implied by Cohen, and then added another $250 each when they formally organized the company at the end of 1970. This would explain why most accounts say the initial owner contributions were $250 without contradicting the balance sheet that shows $350 in ownership contributions by the end of 1971.

With a company and a prototype system in hand, Bushnell and Dabney now turned their attention to raising the money needed to make their arcade game a reality. According to Goldberg and Vendel in Business is Fun, the duo first tried to interest Ampex in the project through their boss, Ed De Benedetti, but he turned them down. Next, Dabney turned to one of his mentors, a former engineer in the Ampex Military Products Division named Irving Roth, but he turned them down as well. Unsure where to turn next, Bushnell made a fortuitous connection through his dentist. According to an interview excerpt in High Score!, Bushnell was discussing his project during a dental appointment and learned that another patient worked at a local coin-op manufacturer called Nutting Associates. According to both Benj Edwards’s article on the creation of Computer Space and Business is Fun (in both of which it must be noted all dates related to Computer Space are off by one year due to faulty recollections of the timeline by Dabney), this dentist appointment took place in February. Bushnell contacted Nutting, and two days later presented his pitch to create a video arcade game for the company. By March, Bushnell had resigned from Ampex and joined Nutting, where he prepared to unleash the first commercial video game on the world.

By 1965, the coin-operated amusement industry was running out of steam. In 1954, the United States Census Bureau estimated the average revenue generated by amusement machines on location in the United States at $722 per machine. By 1963, the Census Bureau estimated that the average revenue per machine had fallen to $639 despite nearly a decade of inflation and the widespread adoption of dime play. No major new product categories had emerged since the spread of shuffle alleys, bumper pool, Dale guns, and two-player pinball in the mid-1950s, while the combination of dwindling markets and consolidation had whittled down the number of manufacturers in Chicago to just five. Furthermore, the inability of operators to recoup the cost of newer machines set to dime play and the resistance of the general public to a higher cost per play had forced the manufacturers to often sell their machines at a loss, resulting in drastic cutbacks to R&D. While Midway continued to explore avenues to enhancing its novelty pieces and Williams continued to innovate in pinball, most new machines coming out of Chicago were basically identical to the machines that had come out the year before save maybe a small new gameplay feature or a new theme in the cabinet art or backglass. An increasing interest in pinball in Europe, particularly after France legalized the game in 1961, helped sustain sales for the surviving manufacturers, but without new game concepts, the long-term future of the industry began to look grim.

But once again coin-operated amusements did not die. Across the Pacific, a newly resurgent Japan, riding the wave of an economic miracle, discovered coin-operated amusements and fell instantly in love. At first merely importers of American products, in the mid 1960s local firms slowly turned to designing their own machines. Bigger, flashier, and more expensive than the arcade pieces coming out of Chicago, the leading Japanese cabinets inspired a wave of technological innovation in the coin-operated games industry that breathed new life into the moribund American manufacturers. And in this rejuvenated arcade climate, in which distributors and operators were newly aware of the potential of advanced displays, unique control schemes, and sophisticated sound, the commercial video game was born.

This is the final post in a six-part series briefly chronicling the coin-operated amusement business from its origins in 1870 to just before the introduction of the first coin-operated video game. Principle sources for this post include The Ultimate History of Video Games by Steven Kent, Winning Pachinko: The Game of Japanese Pinball by Eric Sedensky, Arcade Mania: The Turbo-Charged World of Japan’s Game Centersby Brian Ashcraft, the dissertation Game Centers: A Historical and Cultural Analysis of Japan’s Video Amusement Establishments by Eric Eickhorst, the article “Entertainment Empire of the Rising Sun: A Conversation With Sega Founder David Rosen” by Steven Kent, the article “Firm Seeks Right Button for a 2d Space Invaders” in the November 29, 1981, edition of the Chicago Tribune, the article “Lots O’Fun” in the January 15-22, 1982, issue of Event, numerous articles in Billboard Magazine, the court case Bromley v. Commissioner, 23 T.C.M. 1936 (1964), Report No. 92-418 of the United States Senate, “Fraud and Corruption in Management of Military Club Systems” (1971), a series of Twitter posts from the official account of Taito detailing the early history of the company, an obituary for Michael Kogan printed in the March 1984 issue of Replay Magazine, an interview with Masaya Nakamura in the January 1977 issue of Play Meter magazine, the article “Pac-Man creator bites into County Hall” in the August 31, 1997, edition of the Sunday Times, the 1985 article “Namco: Maker of the Video Age” in the Journal of Japanese Trade & Industry, interviews with several Kasco employees translated under the title “Kasco and the Electro-Mechanical Golden Age” and hosted at shmuplations.com, and the blog All In Color For a Quarter maintained by Keith Smith.

The Birth of Coin-Op in Japan

The Masamura ALL-15, which helped revolutionize pachinko

The emergence of a coin-operated industry in Japan was a slow process complicated by the depletion of Japanese industry as a result of World War II. Before the war, Japan had just begun taking its first steps in the field through a unique game called pachinko. Like pinball, pachinko evolved out of bagatelle, which first reached Japan around 1924, perhaps through a child’s toy version of the game imported from the United States called the Corinth Game. The game soon became common in candy stores across Japan, with children able to win candy or pieces of fruit for high scores, and gained the name “Pachi-Pachi” after the onomatopoeia describing the clicking of small objects such as the balls in the game. Before long, the game spread to markets as well, where adults would play for the chance to win prizes such as soap or cigarettes. The narrow tents and stalls in Japanese markets were not well suited to bagatelle tables, so by 1926 operators were introducing vertically oriented cabinets to reduce their footprint, perhaps taking inspiration from the allwin games popular in Europe. These gambling devices, pioneered in 1900 in Germany with the Heureka, call on the player to press a lever to launch a small ball onto a circular track in the hopes that it will land in a scoring hole so he may win a prize. The vertical orientation, spring-loaded lever, and circular track of the allwin were all features incorporated into the modified bagatelle game the Japanese were now calling pachinko, a combination of the aforementioned “pachi” and “ko,” the Japanese word for ball. As the new game grew in popularity, Japan’s first dedicated pachinko parlor opened in Nagoya in 1930, but just as the game appeared ready to hit a rapid growth phase, the government halted production of all machines in 1937 due to Japan’s need for resources to support its war with China. In 1938, the government went a step further and ordered the closure of all the pachinko parlors in the nation. They would remain closed for the duration of what quickly spiraled into World War II.

In 1946, pachinko returned to Nagoya and from there began spreading across the country once more, but the game did not really take off until a series of important innovations by Shoichi Masamura. Like the earliest pinball games, pachinko before and immediately after World War II was a relatively static game in which the player launched a ball that moved through a nest of pins and perhaps entered a scoring hole. In 1948, Masamura introduced spinners and additional pins on his machines to create a layout known as the “Positive Gage Forest,” allowing balls to bounce around the playfield and creating additional opportunities for them to land in a scoring hole. In the mid 1930s, pachinko manufacturers had developed a form of score keeping in which the machine would automatically eject a ball whenever the player successfully scored, which could be exchanged for a prize. In 1949, Masamura took this concept a step further with the introduction of the ALL-10, which paid out ten balls instead of one. The next year, he upped the total to fifteen in his ALL-15 machine to establish a standard that lasted for three decades.

The impact of pachinko on post-war Japan was unlike any coin-operated machine phenomenon the world had seen to that point. By playing the game, Japanese citizens were able to win everything from soap to vegetables to cigarettes, all of which were in incredibly short supply after World War II. Therefore, the number of pachinko parlors in the country expanded rapidly to a peak of 70,000 in 1953 housing over two million machines taking in over $42 million per month, more than all the department stores in Japan combined. After the government began regulating the industry more closely in 1954, the number of parlors dropped rapidly to a low of 8,000 housing half a million machines in 1956. The introduction of lighting and electrically powered “tulip” scoring pockets in 1960 helped revive interest in the game again, which continued to grow steadily in popularity over the next two decades.

While profitable in the early 1950s, the pachinko industry had more in common with America’s coin-operated gambling business than with its amusement business and did not represent a wider adoption of coin-operated equipment in Japan. Before World War II coin-operated amusements were just beginning to penetrate the country in the early 1930s as the first dedicated game centers began to appear. The pioneer in this field was Kaichi Endo, a purveyor of automatic signs, vending machines, and rocking horses. In 1931, Endo approached the Matsuya department store in Asakusa with a plan to create an amusement venue on the roof of the store combining activities like roller skating, archery, and cycling, with equipment like rocking horses, coin-operated testers, and peep shows. Endo dubbed his new entertainment venue “Sports Land.” Sports Land proved successful, and before long most of Japan’s major department stores incorporated rooftop amusement spaces into their business.

World War II signaled the end of Japan’s first coin-operated amusement industry. While a small number of refurbished arcade machines entered the local economy in the late 1940s and early 1950s, the Japanese people were still desperately trying to recover from the complete devastation of the War and had neither the free time nor the disposable income to engage in most leisure activities. At the same time, however, the United States military began significantly increasing its presence in the country due to the outbreak of hostilities in Korea. This attracted several businessmen interested in providing entertainment for the American servicemen in the country, including influential American distributor Irving Bromberg.

Marty Bromley (l) and Irving Bromberg, who built a vast coin-op empire under the name Service Games

Born in 1899 to Russian Jewish immigrants like so many of the early pinball magnates, Bromberg worked as a glass salesman as a young man and then served as president of the Greenpoint Motor Car Corp. in Brooklyn from 1923 to 1930 before leaving to establish a vending machine distributor called the Irving Bromberg Company. When Leo Berman decided to sell the early pingame Bingo nationally, he traveled to New York to interest Bromberg in selling the game in the city. At the time, Bromberg had no storefront of his own, so he contacted his friend Hymie Budin, who sold items for vending machines, and got permission to display Bingo in his storefront. After some initial difficulty generating interest in the game, Bromberg caught the attention of Bill Shorke, one of the last great penny arcade moguls from the turn of the century, and sales took off. In 1932, Bromberg became a distributor for Bally pins, which helped him grow to become one of the largest distributors on the East Coast and open branch offices in New York City, Boston, and Washington, D.C. Around March 1933, Bromberg moved to Los Angeles to become the first Bally distributor on the West Coast, and he must have enjoyed his new home, because in July he sold his New York and Brooklyn offices (and probably his Boston and Washington operations as well) to focus on the Los Angeles market. He retained ties with New York, however, which became vitally important when Harry Williams developed Contact. Bromberg provided the first national distribution for the game by shipping tables into the New York area, thus playing a critical role in the spread of this highly influential pin game. Bromberg continued to run his company in Los Angeles until he sold out to another distributor in 1946, possibly because he was becoming more involved in a new venture set up in partnership with his son, Marty.

Martin Jerome Bromberg was born in 1919 and operated his first coin-op machines while still a student before entering the family business after graduating high school. In 1940, Marty, who later changed his last name to Bromley, expanded the business by forming a partnership called Standard Games in Honolulu, Hawaii, with his father and friends Glen Hensen and James Humpert to operate slot machines and other coin-operated equipment on American military bases in the territory. Inducted into the Navy after the outbreak of World War II, Bromley worked at a Pearl Harbor shipyard so he could be placed on the inactive duty list and continue to run the Standard Games operation through the end of the war. In 1945, Bromley and Bromberg sold off Standard Games, after which they joined with Humpert to establish a new company in Honolulu to continue their coin-op business called Service Games.

In 1951, Service Games faced a serious threat to its business activities with the passage of the Johnson Act, which not only limited the sale of coin-operated gambling devices, but also banned their operation on military bases within the United States. Stuck with a stock of suddenly worthless slot machines, Bromberg and Bromley decided to send a company salesman named Richard Stewart and a company mechanic named Raymond Lemaire to Japan to establish a company that would buy the equipment from Service Games and operate it at American military bases in the country, which were not subject to the ban. The duo established a partnership called Lemaire & Stewart for this purpose in May 1952. When this business proved successful, Stewart, Lemaire, Bromley, Bromberg, and Humpert formed a new Service Games company in September 1953 as a Panamanian Corporation with Irving Bromberg as president and Dick Stewart as general manager with the sole purpose of purchasing coin-operated equipment from Chicago firms like Gottlieb, Bally, and United and shipping it to Lemaire and Stewart’s partnership, now incorporated as Japan Service Games, so they could operate the machines in the officers’ clubs and open messes of U.S. military bases not just in Japan, but also in Korea, the Philippines, and Guam. The original Service Games in Hawaii also remained a going concern until the Brombergs sold it in 1961.

In 1953, a second company followed Service Games into the Far Eastern military base market, the Cosdel Amusement Machine Company founded by a former U.S. Navy pilot named Kenneth Cole who chose to settle in Japan after the War, which became a distributor of coin-operated amusements and Wurlitzer jukeboxes to bases not only in Japan, but also in Okinawa, Korea, Taiwan, and Hong Kong before ultimately shifting its focus to the record business. As companies like Service Games and Cosdel brought an increasing amount of coin-operated equipment into Asia, a new Japanese coin-operated industry began to take hold as machines originally intended for U.S. military bases began migrating into the local economy through the work of entrepreneurs like Russian businessman Mike Kogan.

Mike Kogan, the founder of the Taito Trading Company

Born into a Jewish family in Odessa, Ukraine, in January 1920, Michael Kogan fled with the rest of his family to Harbin, Manchuria, soon after to escape the Russian Civil War. When Japan occupied the region in 1931, Kogan and other Jewish refugees endured anti-Semitism from Japanese soldiers, but they were also afforded unique opportunities after a small group of military leaders led by Norihiro Yasue bought into anti-Semitic conspiracy literature describing Jewish control of world finance and media and believed Japan should harness the expertise of Jewish refugees in Manchuria to further develop Japan. While Yasue ultimately never realized his so-called Fugu Plan, the brief pro-Jewish sentiment his ideas generated gave Kogan the opportunity to study economics at the prestigious Waseda University beginning in 1939. The outbreak of World War II stranded Kogan in Japan, but in 1944 he was finally able to get out of the country and join his father in Shanghai. Once there, he founded a trading company that operated under the name Taitung –which translates to “Far East” in English and “Taito” in Japanese — specializing in floor coverings, hog bristles, and natural hair wigs. Kogan relocated to Tianjin in 1946, and then to Tokyo in 1950 after the communist takeover of China. Kogan was forced to liquidate his business in the move, but he established a new trading company in 1950 called Taito Yoko. When that business failed, Kogan established the Taito Trading Company in 1953. At Taito, Kogan distilled the first vodka ever produced in Japan and took his first steps into the coin-op industry by importing and distributing a popular line of peanut vending machines and a less successful line of perfume machines.

In 1954, Kogan led Taito into the jukebox business. Unable to secure a license to import machines from the United States because they were classified as luxury items by the Ministry of Industry and Trade, Kogan instead turned to U.S. military bases to purchase broken-down used machines and salvaged parts from three or four of them at a time to cobble together working units. The jukebox business was not very lucrative at first, but once Taito began mixing in traditional Japanese records with American popular music sales began to climb until there were over 1,500 jukeboxes on location in Japan by 1960. In 1956, Taito even developed the first jukebox designed and built entirely in Japan, but quickly abandoned plans for production of the model when Kogan discovered that relatively muted demand made it more economical to continue purchasing American machines. As the Japanese economy improved, Taito finally secured a deal to become the official Japanese distributor of AMI jukeboxes in 1958, ending its reliance on refurbished machines. A deal with Seeburg to become the exclusive Japanese agent for the company in 1962 further solidified its position as one of the top jukebox companies in the nation.

At the same time Taito began exposing Japan to the jukebox, an American named David Rosen began laying the groundwork for a new company that would finally bring a full-fledged coin-operated amusement industry to the country. A Korean War veteran, Rosen’s tour of duty with the United States Air Force from 1949 to 1952 took him across Asia from Shanghai to Okinawa, but he spent the majority of his service in Japan. Rosen quickly fell in love with the country and also realized there was great economic opportunity in the nation despite the complete economic collapse brought on by the war because the inhabitants were too industrious to stay down for long. As a result, Rosen took advantage of a developing trade in portrait painting by establishing a business called Rosen Enterprises in 1951 that arranged for photos in the United States to be sent to Japan to be made into portraits. Upon leaving the Air Force, Rosen returned home to New York with the intention of finishing his degree while furthering the interests of his portrait business in his native country. The business proved unsuccessful, however, so Rosen dropped out of school and returned to Japan in 1954 to transform Rosen Enterprises into a trading company that exported products like paintings, sculptures, and woodcrafts and manufactured small items like cigarette lighters and money clips for the domestic market.

At the time Rosen returned to Japan, the country was still recovering from the devastation of World War II, and every citizen required an ID card for rice rations, railway passes, school applications, and employment. Therefore, there was a brisk trade in photographs for ID cards, which usually cost 250 yen and took 2-3 days to develop. Rosen realized that he could import photomat booths from the United States that were not only cheaper, but also developed the film nearly instantaneously. After testing the photomats, however, Rosen realized that modifications would have to be made because the photos would fade within two years due to inadequate temperature controls, making them useless for official IDs. To solve this problem, Rosen modified the photomats so that a person inside the booth actually developed the film and monitored the temperature, allowing for the creation of photos that would last four to five years. Importing his first booths in early 1954, Rosen soon had a massive hit on his hands as people began waiting in line for over an hour to pay 150 yen to have a picture taken that would be developed within two minutes. Before long, Rosen’s booths, marketed under the Photorama brand name, could be found in over one hundred locations around the country. Rosen’s success soon caused a small international incident as traditional photo studios began staging protests over unfair American business practices, leading him to establish a franchise system. Rosen licensed his technology and supplied film to a group of franchisees that opened another hundred locations, but opening up his system also led to competition from other businesses that began deeply cutting into Rosen’s profits. Therefore, while Rosen kept his Photorama business going into the early 1960s, he began looking for new avenues to expand.

By 1956, the Japanese economy was showing signs of revival, and for the first time since the War Japanese citizens were beginning to have both leisure time and disposable income. Rosen therefore decided to enter the business of what the Japanese Ministry of International Trade and Industry called luxury goods, which required an import license that until recently had been nearly impossible to acquire. Rejecting the currently popular entertainments of pachinko, dance studios, bars, and cabarets, Rosen decided to focus on coin-op games and negotiated a license to bring in $100,000 worth of merchandise and then acquired older games at a relatively cheap price from distributors in the United States who had accepted the games as trade-ins for newer product and then just piled them in warehouses with no idea what to do with them. Rosen concentrated on gun games like Seeburg’s Coon Hunt and Shoot the Bear because owning a firearm was illegal in Japan and these games gave the public an outlet for target shooting. Rosen leveraged good relations forged during his Photorama days with the Toho and Shochiku movie theater chains to place “gun corners” in their establishments. The success Rosen experienced with these first locations allowed him to negotiate a new license for another $200,000 worth of equipment the next year, setting the stage for massive growth in the Japanese coin-operated amusement sector.

Dave Rosen, the father of the Japanese coin-operated amusement business

By 1960, Rosen Enterprises had established at least one movie theater arcade in every major city in Japan, but it was Taito that ultimately took the lead in the new industry, opening Japan’s first large game center near Ureoku Station in Osaka in 1960, which contained over forty shooting games and pinball tables, and becoming the Japanese distributor for Gottlieb pinball machines in 1963. David Rosen, meanwhile, continued to look for other avenues through which to expand his business. A purchased indoor computer golf game failed because the Japanese considered golf an outdoor game, while a slot car business created only a brief fad, but Rosen experienced another success when he decided to establish a bowling alley in Japan. By this point, bowling had been popular in the United States for just over a decade and had reached American military bases in Japan by 1952, but the game had never penetrated the local economy save for a single location in Tokyo that catered to American servicemen. To change this, Rosen decided to place his alley in the Shinjuku district of Tokyo, a popular entertainment area that would guarantee high turnover, and secured space for fourteen lanes in this crowded area by approaching the president of one of the movie theater chains with which he already did business and reaching an agreement to place the alley over one of his movie theaters. Rosen’s alley ended up setting business records as the Japanese embraced bowling as a pastime.

As Rosen’s alley began to take off, the two largest U.S. bowling firms, AMF and Brunswick, partnered with Japanese firms C. Itoh and Mitsui respectively in 1961 and ultimately captured over two-thirds of the domestic bowling business between them. Consequently, bowling alley operation never became an important component of the Rosen Enterprises business. Bowling alleys did, however, become a prime venue for arcade games, so as the number of locations in the country grew into the hundreds and then into the thousands, coin-operated amusements became ubiquitous across the nation. A retail boom in the late 1960s contributed further growth to the industry. As the number of shopping malls, department stores, and supermarkets exploded in the latter half of the decade, they often agreed to host game centers adjacent to their retail spaces or in their rooftop gardens, giving the games even greater exposure.

With demand for arcade games high by the middle of the 1960s, Japanese coin-op firms turned to building their own products for the first time. Taito once again led the way by establishing a new subsidiary called Pacific Amusements Limited in 1963. Pioneering efforts by the company in the years following the establishment of Pacific included an early pachisuro machine, a type of slot machine derived from pachinko, to coincide with the 1964 Tokyo Olympics, and Japan’s first crane machine, the Crown 602, which became an instant hit when deployed in 1965 and inaugurated a product category that has been popular in Japanese game centers ever since. Before long, dozens of small companies were following Taito’s lead by setting up their own manufacturing operations.

The Service Games Complex

The board of directors of Sega Enterprises, Ltd. Dick Stewart is seated at the head of the table. Immediately to his left is David Rosen, and next to him is Ray Lemaire.

While Taito and Rosen Enterprises focused on the Japanese market, Marty Bromley and Irving Bromberg took steps to turn the country’s other large coin-operated amusement provider, Service Games, into an international coin-op empire. Since 1952, the father and son duo had been funneling amusement equipment into the Far East from Panama-based Service Games to Service Games of Japan. Now, they prepared to reverse this process by bringing equipment produced in Japan to the rest of the world. In 1956, a new wholly-owned subsidiary of Service Games was organized in Panama called Club Specialty Overseas, Inc. (CSOI) to serve as a financial clearinghouse for the global operation and to serve as the middle man between Service Games manufacturing and distribution operations. Then, in 1957, Service Games Nevada was incorporated to give the company a presence in the U.S. market and to serve as a final assembly point for slot machines to circumvent a law requiring that machines bought by the government had to be American made. The same year, the company bought a never-before-used Mills tooling set from Bell-O-Matic — for whom it already served as an official distributor in the Far East — and began manufacturing replacement parts and modified Mills designs in Japan. These machines were then funneled through Service Games Nevada and CSOI to Service Games Japan and Service Games Korea in the Far East and another Bromley distributor called Firm Westlee in West Germany for distribution to American military bases. Service Games marketed both its Mills-produced slots and the machines it manufactured itself under the brand name Sega, a contraction of the company name.

As the Service Games complex expanded its operations, it soon attracted intense scrutiny from both the U.S. and Japanese governments. Starting in 1954, the company continually faced accusations of smuggling, fraud, bribery, tax evasion, coercion, and intimidation in its quest to become the largest supplier of coin-operated equipment to the United States Armed Forces around the world. The charges rarely stuck, but there were consequences. In 1959, the Navy banned Service Games from all its bases in Japan, followed by a complete ban in the Philippines the next year. In 1961, the U.S. Civil Administration of Okinawa fined Service Games for smuggling, fraud, bribery, and tax evasion. In 1963, the Air Force banned Service Games from all its bases worldwide.

Perhaps due to so many government investigations tarnishing the Service Games name, Bromley reorganized his web of businesses in the early 1960s. First, on May 31, 1960, Service Games Japan was terminated and two new companies were formed to replace it. Nihon Goraku Bussan KK, literally Japanese Amusement Products Company, Inc., which also did business as Utamatic Inc., was led by Dick Stewart and managed the Service Games operating business in Japan, while Nihon Kikai Seizo KK, literally Japanese Machine Manufacturers Company, Inc., which also did business as Sega Inc., continued the Service Games manufacturing operation under Ray Lemaire. The same year, Firm Westlee changed its name to Standard Equipment & Service, while Service Games Korea became Establishment Garlan. Finally, in 1962 Service Games Panama was dissolved and superseded by CSOI, which became the new heart of the Service Games complex and expanded aggressively into Southeast Asia and England to complement its business in Japan, Korea, Taiwan, and West Germany. Controversy continued to plague the company, however, culminating in a Congressional investigation in 1971 focused on activities in South Vietnam, where Service Games had cornered the coin-operated machine market in the late 1960s through an intermediary named William Crum and his company Sarl Electronics, allegedly helped by widespread bribery of military personnel.

In Japan, Nihon Goraku Bussan and Nihon Kikai Seizo played a key role in the growth of the local coin-operated machine industry. Like Taito, Nihon Goraku Bussan became a major supplier of machines for the domestic market, with a particular focus on jukeboxes. Though it did not run its own arcades, the company imported Rockola jukeboxes and amusements manufactured by Bally and Williams, while also distributing Sega machines produced by its sister company, Nihon Kikai Seizo, which now offered a diverse range of slot machines. In 1960, Nihon Goraku Bussan developed the first Japanese-designed jukebox to actually enter production, the Sega 1000, which was manufactured by Nihon Kikai Seizo. As both companies continued to flourish, they became one company again in June 1964 when Nihon Goraku Bussan absorbed Nihon Kikai Seizo. By 1965, Nihon Goraku Bussan had placed over 3,000 jukeboxes on location and opened branch offices all over Japan.

As Nihon Goraku Bussan and Taito grew in size and scope, a wave of new companies entered the market, and rival firms captured the new bowling business, David Rosen watched as his prime position in the Japanese arcade industry began to dissipate. His rivalry with Japan’s other two large coin-op enterpries always remained friendly, however, so in 1964 he proposed a merger with Nihon Goraku Bussan to create a company that could remain atop the increasingly competitive Japanese coin-op industry. On July 1, 1965, Nihon Goraku Bussan acquired Rosen Enterprises and changed its name Sega Enterprises, Ltd. Rosen became the CEO and managing director of the company, while Dick Stewart became president, and Ray Lemaire took the title director of production and planning. Under Rosen, the combined company began phasing out slot machine production and equipment sales and leasing to military bases so that it could focus on a new primary objective: becoming the top coin-operated amusement company in Japan to facilitate becoming a publicly traded corporation.

Periscope, Sega’s first international hit, adapted from a similar game created by the Nakamura Manufacturing Company

By the time, Rosen instigated the creation of Sega, he had long since moved from importing used games to bringing the latest products over to Japan, but was growing increasingly frustrated with the stagnation taking hold in Chicago. He therefore decided to take advantage of the Service Games jukebox and slot machine factory to follow the lead of Taito by manufacturing his own product. Rosen sensed he could find a niche for Sega in the mid-range novelty market, which had virtually disappeared in the United States. In 1967, Sega became the first foreign manufacturer to join the MOA and completed a deal with Williams to introduce its games in the West. Rosen’s plans changed, however, thanks to an impressive new game from one of his competitors, the Nakamura Manufacturing Company.

Born in 1925 in the Kanda District of Tokyo, Masaya Nakamura was the son of a handcrafted shotgun manufacturer who’s business was destroyed in World War II. The elder Nakamura salvaged what he could from the rubble and opened a gun repair shop in the same Matsuya Department store that had once housed the first Japanese game center on its roof. Meanwhile, Masaya attended Yokohama State University, but could not find a job in the depressed Japanese economy after graduating with a degree in shipbuilding in 1948. He therefore worked in his father’s store performing a variety of odd jobs from sweeping the floors to bicycling around the city to hang advertising posters of his own design. Over time, the Nakamuras transitioned from repairing old rifles to selling brand new air guns, but looming new restrictions on gun ownership and shooting soon threatened the business. The inventive Nakamura decided to modify the guns into children’s pop guns, which brought the family into the toy business.

With the family’s new focus on toys, Masaya Nakamura soon turned his attention to other forms of children’s entertainment. In the 1950s, rooftop amusement spaces were making a comeback in Japan, but the Matsuya store in Yokohama still did not have one. Nakamura therefore purchased two crank-operated mechanical horse rides and received permission to place them in the rooftop garden of the store. Seeing the potential for a new industry, he subsequently established the Nakamura Manufacturing Company in 1955 with just two employees and roughly $1,200 in financing to operate mechanical horse rides in rooftop amusement spaces.

The company initially operated in just a couple of locations, but in 1963 Nakamura accepted a contract to build a rooftop amusement park for the flagship location of Japan’s premiere department store chain, Mitsukoshi, located in the Nihonbashi District of Tokyo. In addition to horse rides, Nakamura added a 3D sound and picture viewing machine, a pond out of which children could scoop goldfish, and an elaborate amusement machine called the “Roadway Ride.” Based on the success of this venue, Mitsukoshi decided to add rooftop amusement parks to all its locations, and Nakamura was soon operating ten facilities across Japan.

By 1966, Nakamura had emerged as one of Japan’s premiere operators of coin-operated amusements, but faced new challenges in a changing market. As the Japanese industry rapidly expanded, manufacturers proved unable to keep up with increasing demand, while larger companies like Taito and Sega that served as both operators and manufacturers were beginning to invade Nakamura’s traditional stronghold of department store play areas. Nakamura responded by opening a new factory that year in the Ota-ku district of Tokyo and secured a license from the Walt Disney Company to use its characters on his projects. Initially, the factory just produced kiddie rides, many of which were modeled on Walt Disney characters, but Nakamura soon turned his attention to more elaborate coin-operated amusements beginning with a game called Periscope.

A target shooting game, Periscope broke new ground in the genre with a gigantic cabinet featuring a plexiglass ocean and plastic ships on a motorized carriage, great electronic sound effects, and an innovative control scheme in which up to three players peered through actual periscopes to target and destroy the ships with torpedoes represented by points of light that traveled across the fake waters. A far more expensive game than the typical $695 machine of the time, Periscope proved a hard sell at first, but the game soon became a hit when arcade operators realized that it could bring in sustained earnings far in excess of most coin-operated games.

When Dave Rosen at Sega noticed the game began drawing attention from distributors in the United States and Europe, he decided to manufacture a version of Periscope for foreign markets. After showing the game at conventions in the United States in Europe in late 1967, however, he quickly realized that it was too large and expensive for export, so he had a single-player unit designed. Still coming in at roughly $1295 when the typical arcade piece would sell for half that amount, however, distributors complained that no one would be able to make money on the game. Sega responded by advising them to sell it on quarter play. Released internationally in March 1968, the single-unit Periscope revolutionized the coin-op industry as the public proved willing to embrace quarter play for such a sophisticated entertainment experience. Too large even in its smaller form for typical street locations, Periscope nevertheless found a home in retail establishments like department stores and shopping malls that would never typically host coin-operated amusements.

With revenues increasing rapidly at Sega thanks to Periscope and the continued growth of the jukebox business — in which Sega had captured just under half of the market with 5,000 machines on location by 1967 — Rosen’s dream of going public suddenly appeared feasible. The company retained an underwriter to begin work on an initial public offering, but ultimately decided the hurdles would be too great. Not only would Sega have been the first American company to go public in Japan since World War II, but it would have also been the first coin-operated amusement company to ever go public in the nation. Rosen and his partners therefore began a search for a Western company that could help take Sega public in the United States and ended up selling to Gulf & Western in 1969, where CEO Charles Bludhorn was on a massive acquisition spree that made the company one of the largest conglomerates in the world. Between June 1969 and January 1970, Gulf & Western purchased 80% of the stock of Sega Enterprises — the entire company save Ray Lemaire’s 20% stake — for a total price of $9,977,043. Bromley and Stewart ended their direct involvement with the company at that point, while Rosen became chairman and CEO of Sega.

With Periscope proving a major hit despite its technical complexity and high price per play, the game spearheaded a revival of the moribund novelty game manufacturing business through a new category labelled “realistic games” in the trade press that incorporated advanced special effects to provide a closer simulation of the real world than previous arcade pieces. For example, Dale gun games began incorporating electronic sound effects to provide more realistic gunshots and explosions, while Sega produced an elaborate flight game in which the player controls a helicopter spinning on a metal arm attached to a plastic mountain that incorporates an 8-track player to provide the sound of the engine and rotor, which actually changes tempo to match the speed of the helicopter. The most important of the realistic games, however, were a new wave of driving games spearheaded by a Japanese manufacturer called Kasco.

Established in 1955 by engineer Kenzou Furukawa under the name Kansei Seiki
Seisakusho and incorporated three years later, Kasco’s first product was a magic lantern device called the “Stereo Talkie” intended to help guide shoppers around the stores of the Hankyu Department chain. As rooftop amusement spaces became popular in Japan, Furukawa repurposed the Stereo Talkie as a picture viewer amusement device called the “Viewbox” that displayed images from Japanese folktales and small comic strips, often accompanied by music. Like Nakamura Manufacturing, Kasco began installing and maintaining kiddie rides in rooftop gardens and transitioned into importing, operating, and manufacturing other types of coin-operated amusements such as a new driving game that would transform what had largely been a niche game type into the arcade’s premiere attraction.

Drive Mobile (1941), the first popular coin-operated driving game in the United States

The first coin-operated driving games — like so many of the early coin-op technologies — were developed in Britain. The earliest known patent for such a game was filed in 1928 by Algernon Evans, though it appears this game was never built. In 1931, another British inventor named Mark Myers patented a game called Road Test that featured a model car set atop a metal drum with a road painted on it that would constantly shift to the left and right as it rotated. The player had to use an actual steering wheel to keep the car centered on the road. In 1941, International Mutoscope introduced the driving game to the United States with a similar concept called Drive Mobile that added a lighted backglass to keep track of the player’s progress across a map of the United States, with the player scoring more points the longer he is able to remain on the road. The concept proved popular, so Mutoscope released a two-player version called Cross Country Race in 1948 and a deluxe version with a sit-down cabinet, Drive Yourself, in 1954. Driving games became one of the staples of the 1950s and 1960s fun spot, with most either using the rotating drum method or slot cars like those found in a toy racing set. They were generally overshadowed by other arcade pieces, however, and few models were designed.

In 1969, Kasco introduced a new driving game called Indy 500. The game’s elaborate
cabinet featured a circular racetrack and several cars painted on individual rotating discs that were illuminated by a lamp, providing striking, colorful graphics and allowing the game to detect collisions between the vehicles. The player therefore not only had to keep his car on the track, but he also had to avoid the other cars to avoid a crash that brought his vehicle to a halt. Electronic sound provided both the steady hum of the car engines and the sounds of impact. Far more realistic and exhilarating than any driving game released before, it became a smash hit in Japan with sales of over 2,000 units.

With Indy 500 proving so successful, Kasco licensed the design to leading novelty game producer Chicago Coin for release in the United States. Dubbed Speedway, the game became the biggest smash hit the industry had seen in years, selling over 10,000 units. The game also played a critical role in the growth of quarter play: Chicago Coin wanted to set the machine to one play per quarter just like Sega’s Periscope, but operators initially balked and asked for two plays per quarter. Chicago Coin therefore tested the game both ways and discovered both models received roughly equal play, which meant the quarter play machine took in twice the money since a single coin bought half the playtime. Speedway consequently shipped with one play per quarter, cementing a new price point that would persist for over twenty years.

In 1969, Sega scored another major hit in the U.S. with Missile. Continuing to push state of the art graphical effects, the game features a rotating filmstrip displaying silhouettes of jet planes that is projected onto the back of the cabinet to create the illusion that waves of bombers are flying towards the player. As the planes move across the cabinet, a wiper blade travels along a circuit board containing a series of contacts. The player must shoot down the planes by aiming his missile using two buttons to rotate it left or right, then firing by pressing a button on top of a
joystick. The missile is attached to its own wiper that passes over a series of contacts, and if both the player’s missile and the wiper tied to the movement of the bombers on the filmstrip are touching the same contact when the player presses the button, a circuit is completed to register a hit and a solenoid pulls a different slide in front of the projector displaying a red explosion graphic.

By 1970, a slew of manufactures both old and new were rushing to emulate the cartoon-like graphics and realistic sound effects of Speedway and Missile, setting off a technological arms race to provide new arcade experiences unlike any the public had experienced in an arcade before. As a result, the early 1970s were perhaps the best opportunity since the Great Depression for a clever inventor with a slick new product to break into the industry despite having little working capital and/or no previous track record with coin-operated amusements. In other words, there would probably never be a better time for Nolan Bushnell and Ted Dabney to introduce the first video arcade game.

During the Depression the coin-operated amusement business flourished by virtue of being cheap. With every last cent precious, a pinball machine that could provide a few minutes entertainment for a mere penny was the closest thing to a luxury many people could afford. In the 1950s, however, the economy was booming, the population was growing and dispersing, and there were many new activities to occupy the time of the prosperous suburban middle class. As a result, coin-operated games morphed from the star attraction of the Sportland to a mere sideshow at a fun spot or department store playland.

Immediately after World War II, it appeared that the coin-operated amusement industry was poised to enter another boom period as manufacturers entered the post-war era with both better equipment and larger manufacturing capacity due to wartime innovations and operators needed to replace roughly ninety percent of the estimated 5,000,000 pinball machines, coin-operated games, vending machines, and jukeboxes in operation at the start of the war. Instead, operators drove themselves to near bankruptcy in 1946 and 1947 trying to replace old machines, while manufacturers continued to increase production through the end of the decade only to discover that distributors and operators could no longer afford to buy from them. As demand for new games fell, the industry began to consolidate as the 1950s progressed until by 1965 what had been over a dozen major manufacturers at the end of World War II were whittled down to just five. While the remaining manufacturers still released a constant stream of product in the 1950s and early 1960s, many of these games began to lack originality, with companies merely incorporating minor changes into existing concepts each year. This placed the industry in danger of stagnating entirely by the middle of the 1960s.

This is the penultimate chapter in a six-part examination of the coin-operated games industry before the dawn of the video game era. Principle sources this time around include Pinball 1: Illustrated Historical Guide to Pinball Machines by Richard Bueschel, The History of Coin-Operated Phonographs. 1888-1998 by Gert Almind, Special When Lit: A Visual and Anecdotal History of Pinball by Edward Trapunski, King of the Slots: William “Si” Redd by Jack Harpster, Bally: The World’s Game Makerby Christian Martels, the article “A Profits Jackpot in Slot Machines” in the March 13, 1977, edition of the New York Times, the article “Gaming Giant Has Checkered Past, Local Ties” in the July 15, 1979, edition of the Boca Raton News, the article “The Seeburg’s Term It Automatic Record Playing, But the Public Calls It the Jukebox” in The American Swedish Monthly, the article “Money in the Box” in the October 27, 1958, edition of Time Magazine, numerous articles from the 1950s and 1960s in Billboard Magazine, the Internet Pinball Machine Database, Bally’s official history from its (now defunct) company website, In re Bally’s Casino Application, 10 N.J.A.R. 356 (1981), and the research and personal recollections of British operator and coin machine historian Freddy Bailey.

The Rise of the Jukebox

The Wurlitzer Model 24 (1937), one of the most successful jukeboxes before World War II

Coin-operated music machines were a mainstay of arcades from the very beginning, with phonographs in particular being one of the major draws of the earliest amusement parlors of the 1890s. After the phonograph came down in price enough that practically anyone could afford one, it largely disappeared from the arcade scene, but other musical devices took its place. Perhaps the most popular machines in the early 1900s were the coin-operated player pianos and organs. These could be quite elaborate at times, as epitomized by the Mills Violano Virtuoso, invented by Henry Sandell, which combined a self-playing violin and piano in a single large cabinet and sold between 4,000 and 5,000 units between 1911 and 1930. The advent of electrical recording, however, pioneered at Western Electric in 1924, greatly increased the quality of recorded music while also allowing the playback of recordings to be amplified. This posed a significant threat to the instrument manufacturers, a challenge first answered by the Automatic Musical Instrument Company (AMI).

AMI began life as two closely linked companies in 1909, the National Piano Manufacturing Company, which built coin-operated musical instruments, and the National Automatic Music Company, which operated them. Its most prominent product in its early years was a player piano that could automatically switch between eight different music rolls, and by the mid 1920s the companies had around 8,500 machines on location. In 1925, the two companies merged into one corporate entity, but did not adopt the name AMI until 1927. That same year, AMI introduced the National Automatic Selection Phonograph, a record player hooked up to a loudspeaker and a selector that could switch between ten records. The AMI unit was not the first multi-selection record machine, but it was the first device to combine a record player, a selector, loudspeaker amplification, and a coin slot. By 1930, 12,000 Automatic Selection Phonographs had been installed, and a new segment of the coin-op industry was born.

In the 1930s, several prominent coin-op manufacturers tried their luck at the Jukebox business including Mills and Rockola, but the leading company was Wurlitzer, a musical instrument manufacturer founded by Rudolph Wurlitzer in 1853 in Cincinnati, Ohio. Starting as an importer of European Instruments, the company became a major manufacturer by supplying instruments to the United States Army during the American Civil War. When the first fairground organs began to appear in the 1890s, Wurlitzer invested in one of the early manufacturers, the North Tonawanda Barrel Organ Factory, in 1897. In 1909, Wurlitzer bought the company outright, shifted all production to New York, and developed an organ for motion picture houses that proved highly successful after being released the next year. With electrical recording paving the way for “talkies” in the cinema and thereby making theater organs redundant, Wurlitzer nearly went out of business in the late 1920s and turned to jukeboxes through purchasing the Simplex Manufacturing Company in 1933, which had developed a multi-selection unit. Simplex owner Homer Capehart became the general manager of Wurlitzer and guided the company back to success. By 1936, Wurlitzer had placed 44,000 jukeboxes on location, and the company continued to dominate the market until the late 1940s, when it was dethroned by the J.P. Seeburg Corporation.

The Seeburg M-100A,which revolutionized the jukebox business in 1948

Born in Gothenburg, Sweden, in 1871, Justus Sjoberg completed a course of study at the Chalmers Technical Institute and then immigrated to the United States in 1887. In the U.S., he took classes at a Chicago night school, studied technical subjects at the Lewis Institute, and took drawing and design classes at the Chicago Art Institute. When he became a naturalized U.S. citizen in 1892, he changed his last name to Seeburg. Seeburg’s first job in the United States was at the C.S. Smith & company piano factory in Chicago, where he learned the musical instrument manufacturing trade. Several years later, he became the superintendent at another piano maker, the Cable Company, before joining with a partner to establish the Kurtz-Seeburg Corporation in Rockford, Illinos, to manufacture piano actions. In 1902, he returned to Chicago to establish the J.P. Seeburg Piano Company, which enjoyed great success as a manufacturer of coin-operated pianos and theater organs.

When AMI debuted the National Automatic Selector Phonograph, Seeburg responded in 1928 with its own eight-record machine, changed its name to J.P. Seeburg Corporation to distance itself from its musical instrument roots, and switched its focus to the jukebox business. The Depression hit Seeburg hard, however, and forced the company into receivership in 1931. In response, Justus expanded his company into nearly every device that could be based around a coin slot, including vending machines, washing machines, parking meters, and arcade pieces like the Rayolite gun games, which restored the company’s financial situation by 1934. That same year, Justus entered semi-retirement and his son, Noel Marshall Seeburg, took over as president. Seeburg remained number two in jukeboxes until 1948, when it deployed the M-100A, the first jukebox able to play one hundred different selections. Arriving just before the advent of high quality multi-track tape recording technology, the introduction of the small and durable 45 rpm record, and the explosive popularity of Rock ‘n’ Roll, the 100A completely transformed the coin-operated machine industry and allowed Seeburg to corner 70% of the jukebox market by 1960.

By the mid-1950s, over 500,000 jukeboxes had been installed across the United States, and the sale and operation of coin-operated music and games, largely separate before World War II, consolidated around the music distributors and operators, who placed an emphasis on jukeboxes installed at bar and tavern locations, leaving comparably little room for less profitable classes of machines. This power shift is perhaps best reflected by changes in the trade organizations of the period. The coin-operated machine industry first organized nationally during the resurgence of the late 1920s, rallying around the first industry trade magazine, Automatic Age, which started publishing in 1925, and the first nationwide trade organization, the National Vending Machine Operators Association, established in 1926 through the efforts of Chicago coin-operated scale manufacturer and operator E.H. Funke. The association held the first national coin machine trade show that February at the Great Northern Hotel in Chicago, which became an annual tradition. The show took place in Chicago in even-numbered years and another major city like Cleveland or Detroit in odd-numbered years, but in 1931 the manufacturers revolted, tired of paying freight to bring their products to other cities when they were nearly all located in Chicago already. These companies therefore banded together to create the National Association of Coin Operated Machine Manufacturers — later shortened to Coin Machine Industries (CMI) — which hosted an increasingly lavish and well attended coin machine show at the Sherman Hotel in Chicago through the rest of the 1930s.

After World War II, CMI fell apart. The vending machine trade came into its own during World War II as factories installed food and drink machines to help workers keep up their strength while churning out military equipment. Feeling their oats, the manufacturers of those machines broke away to form the National Automatic Merchandising Association and launched their own show in 1946, which routinely outdrew the CMI coin show in the late 1940s. That left amusements and jukeboxes for CMI, but the jukebox makers never liked exhibiting at the coin show because they were forced to turn down the volume of their machines and had a difficult time selling them to potential customers. The jukebox makers increasingly retreated to private suites in neighboring downtown hotels to show their products, and as the jukebox grew ever more influential in American daily life, the companies involved in the business increasingly felt they no longer needed the CMI.

Two events cemented the end of CMI. First, the organization announced in 1949 that it would no longer represent companies like Bally that produced payout machines. In protest, Bally president Ray Moloney organized a new trade organization, the American Coin Machine Manufacturers Association (ACMMA), which announced its own trade show set for May 1950. Meanwhile, jukebox route operators George Miller of Oakland, California, and Al Denver of New York City forged a loose collection of state and local operators associations into an alliance called the Music Operators of America (MOA) in 1948 to combat efforts to eliminate the traditional music royalty exemption afforded to jukeboxes. In 1950, the MOA decided to stage its own trade show in November, and CMI, which now stood for Coin Machine Institute, cancelled its show that June when it became clear that distributors and operators did not want to attend another convention so soon after the ACMMA show and were far more interested in clustering around the jukebox and record companies at the MOA convention later in the year. The short-lived ACMMA disbanded in 1951, while CMI tried one more time to stage a show in 1952, but the show floor was largely filled with purveyors of kiddie rides, and attendance was poor. As CMI floundered before the onslaught of the jukebox, the industry it represented also began to shrink.

Death and Turmoil in Amusements

J. Frank Meyer, who led the Exhibit Supply Company into coin-operated machines

In August 1948, Jack Keeney, the pioneering head of J.H. Keeney and Company, passed away not long after suffering a debilitating stroke. J. Frank Meyer, the man who turned the Exhibit Supply Company into a coin-op powerhouse, died that November, just a few months after his trusted sales manager Perc Smith. In 1953, Dick Hood passed, and the Hood family relinquished control of H.C. Evans and Company for the first time. In 1956, William Rabkin, founder of the constantly innovating International Mutoscope, died in a fall from the window of his sixth floor apartment, possibly due to a dizzy spell brought on by high blood pressure. Once vital contributors to a thriving coin-operated amusement business, these companies bereft of their founders and/or primary movers soon looked for greener pastures. International Mutoscope filed for bankruptcy in 1960 and while it managed to limp along for a few more years was never a potent force in the business again, while H.C. Evans attempted to enter the surging jukebox business by purchasing the Mills phonograph division in 1948 and failed so miserably that the company was forced to close in 1955. J.H. Keeney chose to focus on vending machines and slots and slowly decreased its amusement output before releasing its last pinball game in 1963, while even Exhibit Supply, which under Meyer had blossomed into the leading amusement manufacturer of the 1920s, chose to focus on other areas of manufacturing.

During World War II, Exhibit had developed a new switch, the electro-snap, that proved so useful that the company created a subsidiary called the Electro-Snap and Switch Manufacturing Company to continue selling switches to the military after the war. By 1957, the switch business completely overshadowed Exhibit’s dwindling amusement business, so the company chose to end amusement equipment manufacturing and give the factory space over to Electro-Snap. This led to the resignation of company president Sam Lewis, one of a series of short-lived caretakers to run the company after Meyer’s death, and the appointment of arcade division head Chester Gore to run the company. As Exhibit card vendors continued to be popular, Gore moved the company to a larger factory in 1960 to commence manufacturing of card machines again, but it never returned to other amusements. Gore continued to run the company until selling out to a man named Paul Marchout in 1979, who was only interested in the name and effectively shut the company down.

The most shocking industry death of the decade occurred on February 26, 1958, when Ray Moloney, president of the Lion Manufacturing Company and its Bally subsidiary, died suddenly of a heart attack at fifty-eight. From the launch of Ballyhoo in 1932, Moloney had built Bally into one of the largest and most important coin-operated amusement companies, a fully integrated manufacturer of slot machines, payout pinball machines, shuffle alleys, kiddie rides, and various other arcade pieces. Bally not only manufactured coin-operated machines, but through a host of subsidiaries such as the Grand Woodworking Company, Como Manufacturing Company, Ravenwood Screw Machine Corporation, Comar Electric Company, and Marlin Electric Company, it built nearly all the specialized parts and mechanisms used in its products. Most recently, Moloney had led Bally into the vending machine business in 1956 with a well received hot and cold drink machine and established a new subsidiary, Bally Vending Corporation, to sell it.

Moloney’s death threw Bally into turmoil. His entire estate, including Lion and its subsidiaries, was placed in a trust administered by the Chicago-based American National Bank and Trust Company. Longtime Bally executive Joseph Flesch took over as president, but he relinquished control to Moloney’s sons, Ray Jr. and Donald. By that time, the decline in the sale of bingo machines brought on by the 1957 Supreme Court decision banning payout pinball machines had significantly impact Bally’s bottom line, and the company was losing money. American National therefore felt it was in the best interest of the estate to liquidate the firm to pay off debts and estate taxes. Moloney’s sons argued that allowing Bally to develop and sell new slot machines would restore Lion to profitability, but the bank had no interest in funding an operation it assumed would have deep ties to organized crime. The Moloneys bought themselves some time by selling Bally’s highly successful drink vending machine business to Seeburg for $3 million in 1961, but the next year American National decided it was time to dissolve the firm. Bally ultimately survived, however, through the intervention of Bill O’Donnell.

Bill O’Donnell, the man who saved Bally

Born in 1922, William Thomas O’Donnell was educated at Loyola Academy and Sullivan High School, but was forced to drop out in 1939 at age seventeen to support his family by joining the Underground Construction Company, where his father had served as superintendent before dying in 1929 at the age of thirty-five, to help build the Chicago subway system. After enlisting in the United States Marine Corps in 1941 and serving in the Pacific Theater during World War II, O’Donnell briefly served as a postal worker after being discharged in 1945 before a cousin who served as Ray Moloney’s bookmaker suggested he seek employment with Bally. O’Donnell joined the firm in 1946 to work in the purchasing department before Moloney named him assistant sales manager six months later. In 1951, Moloney promoted O’Donnell to sales manager, and upon Moloney’s death American National named him to Lion’s board of directors. O’Donnell subsequently played an active role in trying to save Bally through a management buyout, but he could not find a single bank willing to finance a slot machine company due to fears of ties to organized crime. He therefore turned to Bally distributors for support.

Runyon Sales, a successful New Jersey distributor fronted by Abe Green and Barnett Sugarman, proved amenable and brought in two other investors of its own, a Brooklyn pool table manufacturer named Irving Kaye and a well-connected former vending executive named Sam Klein. A native of Cleveland, Ohio, Klein served in the Army in World War II and then entered the family business, a cafe. In 1954, he purchased the Stern Vending Machine Company of Cincinnati, which he later sold in 1960 to a firm called Emprise Corporation for $1.5 million. At that time Emprise owner Lou Jacobs asked Klein to find other companies for him to purchase, leading him to talk to Green about buying Runyon. The deal never materialized, but Green remembered Klein’s connections when it came time to make the Bally deal. Although hesitant at first, Klein ultimately agreed to come on board and convinced Jacobs to finance a portion of the purchase. This allowed O’Donnell, Klein, Green, Kaye, and Sugarman to form K.O.S. Enterprises and buy certain assets of Lion Manufacturing and the Bally name on June 17, 1963, for $2.85 million. K.O.S. subsequently changed its name to the Lion Manufacturing Corporation and named Bill O’Donnell president. Klein, the largest shareholder of the new corporation, became executive vice president. Subsequent to the purchase, O’Donnell turned his attention to launching the new slot machine Moloney’s sons had failed to complete.

A Revolution in Slot Machines

Money Honey, the first electromechanical slot machine

The slot market Bally hoped to rejuvinate entered the 1960s in crisis. The passage of the Johnson Act coupled with a contemporaneous ban on the manufacture of slot machines by the state of Illinois had virtually destroyed the industry at the beginning of the 1950s, which could now only engage in limited production of machines for Nevada and a few scattered counties and gray markets in other states. The leader remained Mills, which had transformed greatly since its penny arcade days. Company founder Herbert Mills died in 1929, though by then he had already divested much of his authority to his sons, Fred, who served as general manager, and Herbert Jr., who ran production. Fred succeeded his father as president and led the company into vending machines in 1935 in alliance with Coca-Cola, for which it produced one of the first automatic cooled bottle-dispensing soda machines. The company subsequently established the Mills Automatic Merchandising Company in New York to sell gum dispensers and similar machines. In 1943, Mills Novelty changed its name to Mills Industries, Inc. to reflect its more diverse range of activities, which now including vending machines, jukeboxes, slots, and refrigeration equipment.

Fred Mills died in 1944 and was succeeded by Herbert Jr. as president, who decided to separate slot machine sales from the rest of the company by establishing Bell-O-Matic Corporation in 1946. Even with this split the company remained focused on slots until the passage of the Johnson Act, which necessitated an increased focus on vending machines. The company generally struggled after the War, however, and filed for bankruptcy in 1948. The company’s creditors appointed a man named A.E. Tregenza executive vice president of Mills Industries, who sold the jukebox division and pushed hard for expansion in vending, freezers, and ice cream machines. Ultimately, he helped arrange a sale of the company in 1954 to a group of investors led by Richard Dooley. The new investors were not interested in slot machines, so Herbert Jr. and his brother Ralph retained Bell-O-Matic, which had shifted its headquarters to Nevada in 1951.

Mills’ primary competition in slot machines continued to come from O.D. Jennings and its successor, Jennings & Company, established to take over the assets of the original firm after Ode Jennings died in 1953. In 1957, Jennings became a subsidiary of the Hershey Manufacturing Company, and by the early 1960s Jennings slot machines represented 80% of Hershey’s total manufacturing output. Mills and Jennings each held roughly 35%-40% of the slot machine market, with most of the remainder going to Ace Manufacturing, the successor of a firm called the Pace Manufacturing Company. Founder Ed Pace had started in slots in 1926 as a purveyor of used machines before buying out another company to start his own manufacturing the next year. Pace Manufacturing released several popular models in the 1930s and continued operations until the passage of the Johnson Act in 1951, after which Pace retired. Coin-op veteran Harold Baker took up the manufacturing of Pace slot machines at that point, and when he died two years later, Ace took over the operation. In the early 1960s, Ace controlled about 15% of the market.

In 1963, Illinois repealed its slot machine manufacturing ban, and O’Donnell was ready to take Bally back into a market it had abandoned in 1949. Because the Johnson Act had been passed so soon after the complete halt in slot machine production brought on by World War II, most machines in use at Reno and Las Vegas casinos still relied on decades old mechanical technology. These machines were burdened by several limitations, most notably a payout cap of twenty coins, the most that could fit in a coin tube. Larger payouts had to be awarded by an attendant who came over to verify the win, and this extended halt in play created a natural ending point after which the patron would often leave. By incorporating a hopper controlled by an electrical circuit, Bally’s new machines could regulate delivery of several thousand coins in a variety of payout combinations, thereby allowing faster, more exciting play sessions.

The hopper that proved so crucial to Bally’s new slot machine came to the company in a roundabout way thanks to a prominent Vegas distributor named Mickey Wichinsky. Starting as an operator in the Castskills in the 1940s, Wichinksy developed connections with both Runyon Sales and the mob-backed Las Vegas casino operations and moved to Las Vegas in 1956 to establish a distributor called Frontier Vending and take over as the Pit Boss of the Sands Casino, where he became the first person to install Bally machines in a Vegas casino. In 1960, Wichinkky financed the development of a new roulette table produced by Jack Lavigna and Clarence “Doc” Kaufman for the Acme Novelty Company. In addition to providing funding, Wichinsky, who started designing his own games on the side in 1957, also developed the first hopper mechanism for the machine. The roulette proved unsuccessful, but Kaufman also served as Bally’s distributor in southern Nevada and passed the hopper innovation along to the company. Bally built five prototype hopper machines by converting an old mechanical machine called High Hand and passed them along to Wichinsky, who had in the meantime bought out Kaufman’s business and now ran Bally’s southern Nevada distributor, the Bally Sales Company. The prototype proved poorly engineered, however, so Kaufman rebuilt it to create the Bally Model 742A. At first unable to win approval from the Nevada Gaming Commission for the 742A, Bally turned to England, where a law passed in 1960 had legalized slot machines in pubs for the first time. Cyril Shack of the Phonographic Equipment Company began importing the machines by the planeload, but felt that in order to garner mass market appeal, the 742A would need to have a proper name. He suggested Money Honey.

By 1964, Bally was in full production on Money Honey, but many Nevada casino owners were hesitant to buy the new machines, largely due to quality concerns and the expense of replacing their entire stock of machines at once, so production remained limited for the first few years and sales were mostly made overseas. Things changed in 1967 when a veteran Wurlitzer distributor named Si Redd established the Bally Distributing Company in Reno at O’Donnell’s behest with a mandate to sell Money Honey machines in northern Nevada. Redd took to installing up to twenty slot machines at area casinos free of charge and sometimes even offered to reinstall their old machines for free if the owners were not satisfied with the Bally machines. When operators saw their earnings per machine increase by as much as 400% with electromechanical slots, the logjam broke, and Bally took over the market. In 1968, Bally produced 94% of all the slot machines sold in the state of Nevada. Buoyed by this success, O’Donnell incorporated Lion as the Bally Manufacturing Corporation that year with the intent of taking the company public. A long Securities & Exchange Commission investigation followed to insure the company was not a front for organized crime, after which Bally became the first publicly traded coin-operated manufacturer on March 13, 1969.

Innovation in Pinball

Duette (1955) from Gottlieb, the first two-player pinball

Through all the turmoil of the 1950s as companies closed, prominent executives died, gambling devices faced legislation, and target demographics changed, one company continued on as it always had. David Gottlieb was known as a conservative businessman who rarely took risks and ran his affairs as if the entire coin-op industry could fall apart at any time. He therefore refused to chase novelty markets and fads, focusing on the amusement pinball trade that had served him well since Baffle Ball in 1931. While Ray Moloney at Bally expanded into the gambling business as fast as he could and eventually ceased building traditional pinball machines entirely in favor of bingo games, Gottlieb refused to release payout machines of any kind and publicly feuded with his counterpart at Bally, arguing that gambling machines only invited government interference.

Even as shuffle alleys and pool games dominated the first half of the 1950s, Gottlieb continued to focus its attention on pins. While an individual machine in this period might sell only 1,000-2,000 units, Gottlieb maintained an aggressive release schedule of between ten and twenty tables a year to become the dominant pinball manufacturer in the industry. Remarkably, nearly all of these tables were designed by a single man, Wayne Neyens. Born in Iowa in 1918, Neyens was attending Crane Technical High School in Chicago in 1936 when a coin-op company called Western Equipment & Supply came to the school looking to hire a draftsman. Neyens worked part time for Western until he graduated high school and then joined the company full time doing odd jobs in the shop and eventually becoming a line inspector. In 1939, he left Western in a salary dispute and joined Gottlieb as a tester. Neyens designed his first pinball game in 1949, and when flipper inventor Harry Mabs left the company in 1951 to work for Williams, Neyens took his place as Gottlieb’s principle designer.

Pinball experienced few innovations in the 1950s, but Neyens was responsible for most of them. Perhaps the most significant was the advent of multiplayer pinball, in which several players competed with each other for a top score. The key technological innovation that made multiplayer pins possible was the introduction of mechanical reels to tally the score in place of numbers lighting up on the backglass, which debuted in the Williams pin game Army-Navy in 1953. Gottlieb introduced the first four-player pinball machine, Super Jumbo, in 1954, but the game was not particularly successful due to the mistaken perception that four players were required to play the game. Neyens therefore went back to the drawing board and created the first two-player pinball game, Duette, the next year. Duette proved far more successful, and by 1956 multiplayer pinball machines had eclipsed single player pinballs and pool tables in sales at Gottlieb. Multiple players also justified a higher price per play, and along with bumper pool Gottlieb’s multiplayer machines led a transition from penny and nickel play to dime machines. In 1960, Gottlieb introduced another innovation on its Flipper table, the add-a-ball mechanism, created to circumvent laws in certain jurisdictions like Texas were a free play was considered a prize that transformed an amusement pinball into a gambling machine.

Sam Stern (l) and Harry Williams

While industry leader Gottlieb proved a model of stability in the 1950s and 1960s, the number two pinball company, Williams, underwent several profound changes that began when company founder Harry Williams met a man named Sam Stern. Working in the clothing business in 1931, Stern decided on the advice of friends to break into the coin-op industry as a route operator in Philadelphia and became a major player after becoming a Rockola jukebox distributor in the city in 1939. Eager to move further up the chain, Stern walked into Williams’s office in 1947 and brazenly asked to buy 49% of Williams Manufacturing, and Williams, who far preferred designing to managing, agreed to sell. Stern became a vice president at Williams in January 1948 and held the post for the next eleven years before orchestrating a buy-out of Williams in 1959 by Consolidated Sun-Ray, a New York retail conglomerate that operated a variety of businesses from drug stores to discount houses. Both owners were offered cash or stock in the deal. Williams opted for cash and left the company, while Stern took stock and replaced Williams as president of the renamed Williams Electronic Manufacturing Corporation. The merger with Sun Ray did not work out, however, and Williams became independent again in 1961.

Under Stern, Williams could never dethrone Gottlieb from the top of the pinball industry, but it maintained the Williams legacy by being the main innovator of the game in the late 1950s and early 1960s. Leading these developments were Harry Mabs, the flipper inventor who joined the company from Gottlieb in 1951, and flipper refiner Steve Kordek, who stayed at Genco, which became a subsidiary of Chicago Dynamic Industries in 1952, until the company shut down in 1959 and then worked briefly at Bally before joining Williams in 1960. In 1958, Mabs built a game called Gusher that featured the first “disappearing bumper,” a bumper that would lower into the playfield when hit. In 1960, he designed a game called Magic Clock that featured the first moving target on a pinball playfield. Mabs retired soon after, and in 1962 Kordek designed another innovative table called Vagabond that featured the first drop target on a playfield, a special type of standup target that drops below the playfield when hit. The next year, Kordek introduced another important innovation in Beat the Clock, multiball, the possibility of having more than one ball in play at the same time if the proper targets are hit. In 1966, another designer named Norm Clark gave Williams one of the biggest hits of the decade, a 5,100-unit seller called A-Go-Go that featured another new playfield mechanic, a captive ball spinner that spun around and dropped the ball into a hole with a random point value when trapped by the device. These tables helped transform pinball into a game of structure and sequence as the primary objective of the game became hitting a group of targets in a specific order or targeting a specific part of the playfield at a specific time to gain added benefits and bonus points. Ultimately, Williams’ expertise in pinball design attracted the attention of another major coin-op firm with ambitions to expand, the Seeburg Corporation, which had recently come under new management.

In the early 1950s, Herbert Siegel, a journalism graduate working for a Manhattan TV firm, and Delbert Coleman, a University of Pennsylvania law student, combined their resources to buy a stake in a soft drink company that they then swapped to acquire a Cleveland chemical company whose earnings they were able to double in ten months. Next, they set their eyes on Fort Pitt, a Pittsburgh beer brewing company established in 1906. Once Pennsylvania’s top brewer, Fort Pitt had been severely hamstrung by a series of strikes in the early 1950s and had sustained losses of over $1.8 million by 1955. These losses could be offset through a merger with a profitable company, however, so Siegel and Coleman courted the brewer’s longtime president, Michael Berardino, and arranged a merger in April 1956 with two coat companies owned by the Siegel family, Windsor Overcoat and the Jacob Siegel Company. After concluding this deal, Siegel and Coleman marshaled the combined financial might of the new conglomerate to purchase Seeburg that December, which by then enjoyed average yearly sales of around $30 million and average yearly earnings of $2.6 million. With these acquisitions complete, the duo orchestrated a management coup in March 1957, removed Berardino from the company, and secured Siegel’s appointment as chairman of the board and Colemen’s appointment as president of Fort Pitt. The duo then sold off the brewery business that November and changed the name of the parent company to Seeburg Corporation in April 1958.

After securing their hold on Seeburg, Siegel and Coleman initiated an aggressive expansion plan intended to involve the company in nearly every coin-operated field. In 1958, the company purchased the cigarette vending machine business of Eastern Electric. In 1961, it added Bally’s drink vending business. Several more drink and cigarette vending machine purchases followed along with the Kinsman Organ Company, which together made Seeburg the largest manufacturer of coin-operated equipment in the United States. Seeberg’s efforts culminated in an expansion into the coin-operated amusement field in June 1964 through the purchase of Williams from Stern followed by the acquisition of United Manufacturing from founder Lyn Durant that September, which was absorbed into Williams. To run its amusement business, Seeburg kept on Stern as president of Williams after the purchase.

With the closing of Genco in 1959 followed by the purchase of Williams and United by Seeburg five years later, the fraternity of coin-op amusement manufactures dwindled to just five companies: Gottlieb, Williams, Bally, Chicago Coin, and Midway. Gottlieb remained the leader in pinball, a title it would not relinquish until the mid 1970s, trailed by Williams, Bally — back in the amusement pin business after bingo games were banned in the early 1960s — and Chicago Coin. In novelty, Williams continued to dominate pitch-and-bat baseball games and also took the lead in shuffle alleys and ball bowlers — which were often marketed under the United name — after Bally quit production at the beginning of the 1960s. Chicago Coin and Midway, meanwhile, offered the most comprehensive lineups of novelty arcade pieces. With so few manufacturers of equipment, however, stagnation quickly set in as new game designs became stale and predictable and companies often merely incorporating small cosmetic changes into existing concepts to differentiate them from the models released the year before. Just as coin-operated amusements appeared ready to enter a steep decline, however, a savior appeared in the form of a new type of arcade machine from Japan.

Pinball ruled the roost of the 1930s arcade, selling in numbers that no other coin-operated amusement could approach, but it was hardly alone. Sports games, shooting games, athletic machines, crane games, and a whole host of other exotic contraptions continued to exist alongside pin tables under the catch-all categories of “novelty amusements” or “arcade pieces.” After pinball’s decline in the 1950s due to bingo machines, gambling stigma, and the Johnson Act, many of these products came out from pinball’s shadow to take center stage in the industry. Pinball did not vanish, of course, continuing to contribute significant revenues, but it was no longer the dominant game in production. Instead, it was the novelty products that drove the industry, with new concepts like shuffle alleys and bumper pool briefly taking the market by storm and then being superseded by the next big thing. At the same time, the decline of the inner city and the rise of suburbia coupled with the onset of the Baby Boomer generation signaled a shift in arcade venues once again. While the big inner city arcades did not disappear entirely, by the end of the 1950s coin-operated amusements had dispersed across fun spots like bowling alleys and skating rinks and shopping venues like department stores and discount houses while exhibiting a new focus on children’s entertainment. This helped precipitate a period of rapid consolidation that left only five major producers of coin-operated games by 1965.

The playfield of All American Baseball, the first pitch-and-bat style coin-operated baseball game

The first novelty games to achieve prominence in the late 1920s were the floor-model sports cabinets like the Chester-Pollard football and golf games that fueled the new Sportland arcade. This genre enjoyed its peak popularity between 1927 and 1931, after which the high cost of the cabinets and the nickel playing price left an opening for the penny play pinball machines to begin their rise to dominance. Nevertheless, new sports games would continue to appear from time to time during the Depression, complimenting the pinball and crane games that dominated the decade. After World War II, with pinball on the decline and crane games banned entirely by the Johnson Act, sports games began appearing in greater numbers, although they were never one of the main selling points of the arcade. While at least one game for just about every popular sport in the U.S. was released over the next two decades, the most widely emulated sport was baseball.

The first known coin-operated baseball game was created by Californian George Miner in 1929. Both an avid baseball fan and an accomplished coin-op engineer, Miner combined his interests in the All American Baseball Game. Clearly inspired by the Chester-Pollard output, All American Baseball featured manikins displayed in a large wooden cabinet and a bat controlled by a lever similar to the one on the Play Football game. Holes in front of each fielder represented outs, while a series of troughs along the back of the cabinet represented everything from a foul ball to a home run. For a nickel, the player could keep swinging at balls until he made three outs. Miner established the Amusement Machine Corporation of America in Nevada in 1930 to sell the game, but in 1931, he sold the rights to Harry Williams when the sports game market went south. Williams remained enamored with baseball games for the rest of his career and became one of the principle drivers of the market both before and after establishing the Williams Manufacturing Company in 1943. In 1935, after he joined Bally, he and Miner prepared to create an updated version of All American Baseball for the company, but these plans were cut short when Miner died in a plane crash on October 7. When Williams moved to Rockola in 1937, however, he brought the Miner patents and tooling with him and created World Series 1937, which proved a modest hit.

After World War II, Bally ushered in a new era of baseball games in 1947 with Heavy Hitter, for which it purchased the rights from its inventor, a Royal Oak, Michigan, cab driver named Jimmy Keller. Key to the new game’s popularity was the fast, unpredictable delivery of the ball, accomplished through a mechanism that launched it from under the table. Several imitations followed from companies like Gottlieb and United, but the Williams Manufacturing Company seized leadership of the genre. Beginning with a game called Box Score in 1947, Williams manufactured a new baseball game nearly every year through 1973. Innovations by Williams over those twenty-five years include the first “running man” unit, which circled the bases as the player recorded hits, on Super World Series in 1951, one of the earliest games with multiple pitch types, Deluxe Short Stop, in 1958, the first game to allow additional playing time for reaching a certain score, Extra Innings, in 1962, and the first game to use electronic sound, Action Baseball, in 1971. United remained a close competitor and often copied Williams innovations, though quite possibly with the permission of Harry Williams himself seeing as he and United owner Lyndon Durant were old friends.

Ten Strike, a popular manikin bowling game from H.C. Evans and Company

While baseball remained the most enduring sports game of the period, manikin cabinets devoted to other games appeared from time to time. One of the most popular — both before and after World War II — was a bowling game called Ten Strike produced by H.C. Evans Company. Originally founded by Edwin Hood in 1892 as a carnival supplier, H.C. Evans became a pioneer of console gambling games under the founder’s son, Dick Hood, with the wildly popular Galloping Dominoes unit in 1936. By 1939, Evans was really feeling the heat of the anti-gambling lobby and decided to produce a console game incorporating skill-based elements, which led to the development of Ten Strike. In this game, the player uses a knob to position the arm on a mannikin holding a steel ball and then presses a button to launch the ball at a set of miniature bowling pins. The game remained in continuous production from 1939 to 1953 — with the exception of the war years — and entered production again in 1957 as the two-player variants Ten Pins and Ten Strike from Williams after that company bought the rights from Evans in 1955.

Another company to invest heavily in sports games was International Mutoscope, known for being one of the premiere innovators in the field of coin-operated novelty machines. In the early 1940s, the company deployed the earliest known coin-operated hockey game, Play Hockey. Presaging the the ball-and-paddle video games that rose to prominence in 1973, this game placed two players in control of manikin hockey goalies at either end of a long table. Each player could swing his goalie’s stick by rotating a knob, and the objective was to knock a ball into the opposing player’s goal. In 1948, the company deployed another unusual sports game, a boxing title called Silver Gloves. In this game, each player controls a boxer through a lever that allows him to move left and right and a trigger that allows him to punch. The goal is to knock the opposing player’s boxer down.

Goalee, a hockey game by Chicago Coin

Perhaps the company that experienced the greatest success with non-baseball manikin sports games was Chicago Coin. The story of Chicago Coin is intimately tied to that of Genco, as the founder was yet another brother of the three men that established that company and was actually responsible for getting the family into the industry in the first place. Samuel H. Gensburg was born in Russia in 1893, but the family immigrated to the United States when he was three years old and settled in Pittsburgh. A natural businessman, Gensburg helped out in his father’s grocery store for a time until he decided he wanted to open his own store at sixteen. Before long, his store was outperforming his father’s, and he opened a second store the next year followed by a nickelodeon cinema the year after that when he was just eighteen. At roughly age 20, Gensburg left Pittsburgh to seek new opportunities in the Western United States, but those plans ended in Chicago when he met, fell in love with, and ultimately married Dora Wolberg in 1919. He worked as an order filler for Sears for a time and then moved to Iowa to run a grocery store.

Eight years later, Sam learned about a company up in Milwaukee that had installed a

coin-operated machine that vended Hershey bars and decided to install one in his store. When it proved successful, he bought 100 of the machines and relocated to Chicago to place them in bars and taverns in partnership with his brother, Dave. In 1929 or 1930, the Gensburg brothers were introduced to the Little Whirlwind machine developed by coin-op innovator Howard Peo. Like the early pinball games, Little Whirlwind was a countertop unit in which the player launched steel balls onto a playfield and hoped they landed in scoring holes, but it had a vertical orientation rather than a horizontal one and featured spiral lanes rather than pins, taking inspiration from the allwin gambling games currently popular in Europe. Figuring the game would be a nice addition to his route, Sam contacted another of his brothers, Louis, a manufacturer of prizes for Cracker Jack boxes, who built a copy of Peo’s game called Hearts that the Gensburg brothers sold for a cheaper price. When Peo threatened legal action, the trio brought in a cousin who had invented an electric pencil sharpener and a bicycle coaster brake, to build a new version that did not run afoul of Peo’s patents. Based on this arrangement, Louis, David, and their brother Meyer established Genco in 1931, while Sam joined with his brother-in-law, Sam Wohlberg, and a third partner named Lou Koren, to establish a trade-in business for used coin-op machines dubbed the Chicago Coin Machine Exchange.

Before long, Sam decided that he could make better pinball machines than his brothers and established Chicago Dynamic Industries as a manufacturer of games marketed under the Chicago Coin name. The company started making replacement boards for popular existing games like Ballyhoo before deploying its first original pin table, Blackstone, in 1933. Two years later, the company experienced success with Beam-Lite, the first pinball game with a lighted playfield and a 5,000-unit seller. Like Genco, Chicago Coin prided itself on improving on the ideas of others rather than making important technological innovations itself, so the company rarely had a leading game in the market. One of its pingames, however, a 1947 flipperless release called Kilroy, sold a remarkable 8,800 units, the most of any pin game between World War II and the first licensed games of the mid 1970s.

In addition to pinball, Chicago Coin aggressively entered every novelty category in existence, which guaranteed that even though few of its products were leaders in their field, the company remained generally successful based on the sheer volume of its output. Therefore, it is no surprise that the company quickly embraced sports games after World War II. In 1946, Chicago Coin released a game called Goalee [sic], an enhancement of the International Mutoscope Play Hockey game that replaced the dials with levers and included an electric motor, thereby allowing a single player to challenge a hardware-controlled opponent. Popular for years after its debut, Goalee brought Chicago Coin over half a million dollars in revenue. The next year, the company expanded its sport line into basketball with Basketball Champ, in which one player controlled a player trying to make a shot on the basket and the other player controlled a defender attempting to block the shot. While manikin sports games like these achieved some popularity, however, it was larger table sports games that fueled a new expansion of coin-operated amusements into bars and taverns in the 1950s.

Bowling, Bumper Pool, and Shooting Galleries

Shuffle Alley from the United Manufacturing Company, which ushered in a whole new category of coin-operated amusements

The decline of pinball in the postwar era was not just due to the game being outlawed in major markets like New York, Los Angeles, and Chicago. Just as damaging was the continuing stigmatization of the game as a front for organized crime due to the production of payout models such as Bally’s bingo games. As a result, many legitimate businesses were hesitant to allow any pingames on their premises, denying distributors and operators the same access to bars and taverns they had enjoyed during the Depression. Therefore, coin-operated amusement manufacturers urgently needed to develop new table games to stay relevant in postwar America. The solution to this problem came from Lyn Durant and his United Manufacturing Company, which had the good fortune to develop a new type of game just as a new fad began sweeping the country.

In October 1949, United deployed a bowling game called Shuffle Alley in which the player launched a small metal-cased object similar to a hockey puck down an eight-foot lane to trigger switches on the playing field that would cause suspended pins to retract to simulate being knocked down. Similar coin-operated games had appeared as far back as the 1890s, but had never really caught on in a big way before. This time, however, things were different. For one, United melded its bowling game with some of the most popular features of the pinball table such as electromechanical engineering, totalizer scoring, and a colorful, lighted backglass. More importantly, however, American Machine and Foundry (AMF), a major defense contractor looking to diversify its business, deployed the first automatic pinsetter for bowling alleys in 1951. Spurred by this innovation, bowling quickly became one of the most popular competitive sports in the United States, and new bowling alleys opened across the nation. With bowling so popular, bar owners that would never think of hosting a pinball table due to their sinister reputation were soon clamoring to have a shuffle alley in their establishments. United sold over 10,000 units of its Shuffle Alley game and was quickly joined in the market by other companies like Chicago Coin and Genco, but the dominant company in the field was Bally, which by the mid-1950s was releasing a new game every other month in a variety of configurations to fit the needs of bars and taverns of all shapes and sizes. Although introduction of new models declined after 1955 as the market neared saturation, shuffle alleys continued to be produced into the 1990s.

Just as the shuffle alley began to decline, another new concept appeared to keep the tavern market going. Before the Great Depression, the game of pocket billiards had been one of the most popular table games in the United States. So popular, in fact, that in the late nineteenth century betting parlors — called “poolrooms” at the time — often featured billiard tables so patrons could pass the time between horse races. As a result, Americans soon began referring to the game of pocket billiards as pool. During the Depression, pool entered a long period of decline that continued after World War II and did not end until the 1960s. In the meantime, manufacturers looked for other ways to keep the pool table relevant.

In May 1955, a Bay City, Michigan, company called Valley Manufacturing, originally established as a shuffleboard manufacturer in 1944, introduced a new billiards game called bumper pool. Rather than featuring pockets around the perimeter of the table, this game features just two holes set into either end of the table, one for each player. Upon inserting a dime, each player is provided a cue stick and five balls, which he has to shoot into the hole on his opponent’s side of the table. In the middle of the table are eight strategically placed bumpers to make shots more difficult. In 1954, no coin-operated pool games had been introduced into the market, but after Valley’s game took off, a whopping thirty games debuted before the end of the year. In 1956, the number of new games jumped to 52, by far the most models introduced of any type of amusement machine that year. Subsequently, the number of new bumper pool models declined precipitously as the brief fad ended. In 1957, however, both Valley and another firm called Fischer Manufacturing put a coin slot on a traditional six pocket pool table, bringing coin control to the standard billiards industry. As interest in pool revived in the 1960s, coin-freed pool tables became one of the pillars of the coin-operated amusement industry.

Air Raider from J.H. Keeney and Company, a popular target shooting game during World War II

Another game that experienced increasing popularity both during the Depression and in the post-war period was the coin-operated target shooting game, in which a player uses a gun-shaped controller to aim and shoot at targets. Shooting galleries were a popular destination in Victorian England, so it should come as no surprise that the earliest coin-operated rifle games appeared — like so many other coin-operated machines — in Great Britain in the 1880s and 1890s. The earliest known game of this type, in which inserting a coin would release the firing mechanism on an actual rifle that fired either pellets or real bullets, was created by Englishman William Reynolds in 1887, but it proved unsuccessful. Over the next several years, innovations in the field centered around the countertop trade stimulator models until the next major breakthrough in full-sized target shooting, the electric rifle, was patented by Englishman J.L. McCullogh in 1896. This rifle did not fire a projectile, but could be attached to a target via wires and register hits by determining the position of the gun relative to the target through the use of wipers and contacts. Popular in both Great Britain and the United States at the turn of the twentieth century, electric rifle games ultimately faded from the public consciousness as the arcade fell out of favor in the 1910s.

In the mid 1920s, the electric rifle returned to prominence in the United States thanks to the efforts of William Gent. Born in Rockford Illinois in 1871, Gent entered the coin-operated machine business in 1903 through the Buffalo firm of Mark Wagner & Company. In 1906, Gent moved to Cleveland to become the manager of the United Vending Machine Company, which was reorganized as the William Gent Vending Machine Company in 1917. As coin-operated games returned to prominence in the 1920s, Gent, by then one of the most influential entrepreneurs in the coin-op industry, decided to redesign the old electric rifle concept by replacing the plain circular target on a cast-iron lollipop stand with a wooden cabinet featuring an array of targets such as ducks that “quacked” when hit and planes with propellers that would spin when they were shot. Gent marketed this game as the Electric Rifle.

In 1929, a Canadian inventor named Henry Clavir created his own twist on the shooting game with Radio Rifle, the first game to employ targets projected on a screen. In this game, a rifle sits atop a large metal box housing a roll of film and a projector. Upon the insertion of a nickel, the projector turns on and beams the top image on the film roll onto a surface. The player receives five shots, and each time he pulls the trigger, a needle inside the machine synced to the position of the gun punctures the film, which looks like a bullet hole on the projected image. After the player takes all his shots, the machine cuts the target off the film roll and vends it to the player as a souvenir.

The Rayolite Rifle Range, perhaps the first target shooting game utilizing a light gun

Gun games using contacts and needles were ultimately superseded by guns using light sensing technology. The earliest patent for a light gun was filed in 1920 by an Englishman named W.G. Patterson, but he appears not to have created any games based on his invention. Instead, a small Tulsa, Oklahoma, firm called the Rayolite Rifle Range Company pioneered the light gun game. Established in 1934, the company was built around the Ray-O-Lite System, patented by Charles Griffith in the same year the company was founded, in which a specially-made gun shoots a narrow beam of light when the trigger is pulled that is picked up by a solar cell attached to a target to register a “hit” on the object. The company created the Rayolite Rifle Range around this system with a duck as the target, which was manufactured starting in 1935 by the Seeburg Corporation. When the game proved successful, Seeburg continued to create other popular light gun games over the next decade and a half such as Chicken Sam (1939), Shoot the Bear (1947), and Coon Hunt (1952).

With World War II looming in Europe by the end of the 1930s, the light gun reached the apex of its popularity as games with a military theme took center stage, led by the releases of J.H. Keeney and Company. In 1939, Keeney deployed Anti-Aircraft Machine Gun, which featured a large metal machine gun replica and targets projected onto a screen. The game proved so popular that a number of variants were released over the next two years such as Air Raider and Shoot Your Way to Tokyo. Meanwhile, Seeburg created war-themed variants of its popular Chicken Sam gamelike Trap the Jap and Hit the Siamese Rats. The popularity of these light gun games peaked in early 1942, after which the production of new amusement machines was curtailed by the entry of the United States into the war. Light gun games failed to enjoy the same success after the war, superseded by a new gun game concept pioneered by an engineer named Eldon Dale.

An early Dale gun game manufactured by the Exhibit Supply Company

A native of Missouri living in Long Beach, California, Dale developed his own twist on the old electric rifle game by having the gun swivel on a stand attached to a metal rod extending under a greatly truncated playfield. If the player lined up the rifle perfectly with a target, the metal rod would touch it, and a pull of the trigger would complete a circuit to register a hit. To give the illusion of a large playing area within the small cabinet, Dale used a mirror to reflect the targets in a manner similar to a submarine periscope. Before the Dale system, both light gun and electric rifle games required a great deal of space to place enough distance between the player and the target, making them suitable only for larger venues. The Dale game, however, fit in a cabinet no larger than a pinball table, making gun games suitable for a variety of locations.

Dale created his gun game at his own Eldon Dale Manufacturing Company, but it was released nationally by the Exhibit Supply Company as Shooting Gallery in March 1950. Once the game was in the field, however, Exhibit discovered that the Dale mechanism could easily shock the player, so the company redesigned it and released a whole line of games in October 1950 featuring the same basic setup but different themes and cabinet art. Before long, Genco and United were making versions of the Dale gun game as well. Production of Dale games peaked in 1954, a year in which fifteen different gun games were released and manufacturers built over 7,000 cabinets in just seven months. Although fewer games were produced per year after that, target shooting games remained an important draw not just at arcades, but at a wide variety of new venues that began appearing by the end of the 1950s.

Fun Spots and Playlands

Gun games and a sound recording booth at the Wonderland Arcade in Kansas City, Missouri, 1968

Throughout the 1950s, the United States experienced great population shifts as the development of the Interstate Highway system and the rise of an automobile-centric culture led many families to leave life in the big city for rapidly developing suburban communities. As a result, traditional arcades once again entered a period of decline, trapped as they were in newly blighted inner city neighborhoods. Simultaneously, as the youth population of the United States exploded through the onset of the Baby Boomer generation, all manner of new entertainment venues opened their doors in suburbia such as bowling alleys, roller and ice skating rinks, public swimming pools, drive-in theaters, and amusement parks. Collectively referred to as “fun spots,” there were an estimated 21,093 such venues around the country by 1958 taking in $2 billion annually. With the inner city arcade once again falling by the wayside and many bars only amenable to select pieces like shuffle alleys, these fun spots were vitally important to the continued well-being of the coin-operated amusement industry.

During the Depression, coin-operated amusements had catered to adults looking to forget their troubles for an hour or two through the relatively cheap thrills of the penny arcade. With amusements expanding heavily into fun spots in the 1950s, however, the emphasis shifted to providing fun for the whole family — and especially for children. Therefore, sports games, gun games, driving games, ball bowlers (a variation on the shuffle alley first introduced by United in 1956 that sported longer lanes and miniature balls rather than pucks), snack vending machines, and novelty pieces like instant photo booths and voice recorders all played an increasingly prominent role in the industry. Perhaps the greatest indicator of the importance of children to the new amusement arcade, however, was the rapid development of a new segment of the business during the decade, the kiddie ride.

In 1931, Otto Hahs, owner of the Hahs Machine Works in Sikeston, Missouri, decided to build a mechanical horse to entertain his children. Before long, children from around the neighborhood were showing up in droves to ride this contraption, so Hahs decided to attach a coin chute and a timer to turn it into a commercial product. Hahs experienced some success in selling his rides to arcades and amusement parks — as well as exhibitors at the 1933 Chicago and 1939-40 New York World’s Fairs — but they remained a niche attraction. In 1949, however, the Exhibit Supply Company engaged Hahs to design kiddie rides that it would mass produce, signalling a new phase in the business.

Initially, Exhibit followed Hahs’s lead in selling the rides to amusement parks and arcades, but the company soon felt that a better target for the product would be department stores, which generally hosted rides such as trains, boats, and ferris wheels in their toy sections during the Christmas season to lure in holiday shoppers. Store owners were skeptical at first, but a 22-year-old entrepreneur named Matty Carbone ultimately convinced the Chicago department stores Goldblatt and Weiboldt to install a few kiddie horse rides, which proved to be a great draw, often taking in $100 per horse per week. Other stores quickly installed their own rides, and by 1953 there were 8,200 kiddie rides in operation around the country, mostly horses, but also other conveyances like cars, boats, and rocket ships. Exhibit Supply remained a leading firm, but Bally invested heavily in kiddie rides as well. By 1959, the popularity of kiddie rides and similar amusements had paved the way for yet another new arcade venue, the playland, which would be situated in a high traffic area of a department store, discount house, or shopping center and offer a full range of coin-operated rides and games aimed at children.

Hank Ross, co-founder of the Midway Manufacturing Company

The new demand for arcade pieces to fill fun spots and playlands aided the growth of the last significant coin-operated amusement manufacturer founded before the dawn of the video game era, and the first such company since the start of the Great Depression not established to focus on pinball. Mechanical engineer Marcine Wolverton, who went by “Iggy” because many people considered Marcine to be a girl’s name, designed aircraft ordinance during World War II and then entered the coin-op industry after its conclusion, briefly working at jukebox maker Wurlitzer before landing at the United Manufacturing Company. In 1947, he was joined there by electrical engineer Hank Ross, who had previously worked for Exhibit Supply. When United began to encounter difficulties in the late 1950s, Wolverton and Ross, regarded as two of the company’s top designers, decided to strike out on their own. Scraping together $5,000 dollars, they formed an equal partnership in October 1958 based in the Chicago suburb of Franklin Park, Illinois, called the Midway Manufacturing Company, named for the nearby Midway Airport.

Wolverton and Ross planned to survive as a small company in the highly competitive coin-op industry through a low overhead factory operation that would allow them to undercut competitors on price. To that end, they leased a small 5,000 square foot manufacturing facility and fabricated most of their factory installations and game parts themselves. Working long hours at the plant during the day, both men also attended night school to brush up on business. In January 1959, the duo began production of their first game, a shuffleboard with a rebound feature called Bumper Shuffle, followed in May by a unique game called Red Ball in which the player presses buttons to launch balls at a bingo-style play field in the hopes of arranging them in various configurations to score points. In 1960, the company scored its first major hit with a pellet shooting game called Shooting Gallery and thereafter focused largely on gun games and pitch-and-bat baseball games, also adding a shuffle alley line in 1966 after moving to a larger facility in nearby Schiller Park. In 1964, Midway introduced two important innovations to Dale-style shooting games through a wild west themed game called Rifle Champ, automatic speed control that causes the targets to speed up as the player scores more points and targets that appear to glow through the use of fluorescent paint and a black light. Glowing targets became standard in most target shooting games going forward, one of the few major innovations in an industry beginning to show signs of stagnation. By 1965, Midway’s innovative game designs and manufacturing skill had brought the company enough success that the trade press recognized the firm as one of the “big five” manufacturers of coin-operated amusements alongside Gottlieb, Bally, Williams, and Chicago Coin, the only significant companies to survive — and sometimes just barely at that — a brutal shakeout of the industry in the late 1950s.